THG has instituted a major restructuring with significant employee impact.
- Employees informed about return to office five days a week starting 19 August.
- Up to 171 redundancies potentially affecting six divisions including beauty and nutrition.
- The decision follows significant pre-tax losses and strategic shifts in partnerships.
- Formal flexible working arrangements remain in place, but under review.
On 24 July, THG announced that it will enforce a mandatory return to office policy, requiring all employees to work on-site five days a week starting from 19 August. This marks a shift from the previously stated flexible working arrangements that allowed remote work one day a week, a decision attributed to inconsistent adherence and its negative impact on the corporate culture.
The company simultaneously revealed a possible reduction of up to 171 positions across six different divisions, such as beauty and nutrition. This restructuring effort is part of a broader strategy to sustain growth, profitability, and cash flow. A THG spokesperson stated that the company is focused on enhancing operational efficiency to serve its global customer base better. The restructuring will involve leveraging recent investments in automation, technology, and artificial intelligence, which may lead to certain roles becoming redundant, although THG plans to support affected employees by offering alternative positions within the group.
These announcements come after THG reported a pre-tax loss of £252 million for the year ending December 2023, an improvement compared to the previous year’s loss of £549.7 million. The restructuring also follows the strategic collaboration between THG and Frasers Group, where Frasers agreed to acquire the luxury etailer Coggles.
Despite the return to office order, THG has specified that existing formal flexible working agreements will still be upheld, though they may be subject to further review. This nuanced approach reflects THG’s need to adapt its operational model to current economic challenges while attempting to preserve elements of workplace flexibility.
THG’s latest actions underline its strategic pivot towards operational efficiency amidst financial challenges and economic adjustments.
