The toy industry continues to take a beating with word that changes are in store for Hasbro. While they aren’t using the term “layoff” just yet, in a new statement, Hasbro has confirmed that some “difficult” changes are coming that will affect “a single digit percentage” of their global workforce. Local news agencies, such as the Providence Journal, have been pressing Hasbro for further clarification on the looming layoffs, but they have refused to give further explanation on what’s to come. Hasbro provided their local news outlets with the following statement:
“As part of Hasbro’s ongoing transformation we continue to make meaningful organizational changes. While some of these changes are difficult, we must ensure we have the right teams in place with the right capabilities to lead the company into the future. We continue to add new capabilities based on our understanding of the consumer and how our retailers are going to market, while evolving the way we organize our business across our Brand Blueprint.”
According to a Providence Journal report, the layoffs will not require Hasbro to file a Worker Adjustment and Retraining Notification. Companies would typically file a WARN notice if mass layoffs of 500 or more employees, or 50 to 499 workers if they make up 33% of the workforce at a single location. Federal law requires a WARN notice to be filed 60-days ahead of scheduled mass layoffs.
This news comes on the heels of a potential lawsuit. Investors have retained the services of Pomerantz LLP, and they are investigating claims that “Hasbro and certain of its officers and/or directors have engaged in securities fraud or other unlawful business practices.” Check out that press release in full Here. Hasbro stated that the changes mentioned above have no relation to these claims and that “The claims have no merit and we intend to vigorously defend against them.”
One thing is for certain, rough waters are ahead for the maker of Marvel Legends, Transformers, and My Little Pony. With the loss of Toys R Us this year, the race to claim retail space for toys is more difficult than its ever been. More information may come to light on Monday, October 22, when Hasbro is scheduled to release their Third Quarter financial results.