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Coronavirus layoffs: Stubborn shutdowns trigger fresh Bay Area job cuts

Coronavirus layoffs: Stubborn shutdowns trigger fresh Bay
Area job cuts 1

Some Bay Area companies have begun to switch from furloughs to layoffs for large numbers of employees amid coronavirus-linked business shutdowns that have been reinstated or have yet to show signs of ending.

Among the latest to reveal job cuts for one reason or another: VMWare, downtown San Jose’s Hilton Hotel, Veritas, Blackhawk Country Club, Gap, Chartwells, and Silver Creek Sportsplex in San Jose.

“VMWare has developed plans to implement a workforce reduction at its facility located at 3401 Hillview Ave. in Palo Alto,” Sean McConnell, a VMWare corporate counsel, wrote in a WARN notice this month to the EDD.

Palo Alto-based VMWare said the layoffs affect 148 workers and will occur in October and December at the company’s headquarters, according to the WARN filing, which the EDD received on Aug. 17.

In recent weeks, some Bay Area companies said they are so uncertain about plans by state and local government agencies regarding reopening and restrictions that they decided to reduce staffing, filings with the Employment Development Department show.

The Hilton Hotel in downtown San Jose and LSI-Silvercreek, a south San Jose fitness and sports center, each cited the uncertainties of government rules and mandates in official WARN notices sent to the EDD.

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“We did not foresee that ‘lockdown’ orders, initially issued for short durations in certain specific cities, would spread throughout the country and be constantly and continually extended or changed,” Jimmy Sarfraz, general manager of the Hilton San Jose, wrote in the WARN notice. Hilton laid off 126 workers, effective Aug. 10, at the hotel, located at 300 Almaden Blvd. in downtown San Jose.

The cascade of shutdowns did more than interrupt travel and commerce for a short period. It also disputed commerce and travel for the “foreseeable future,” Hilton stated in the WARN notice.

Hilton also blamed government officials for an unexpected new round of shutdowns.

“Contrary to our expectations, Santa Clara County and the state of California have just recently extended shelter in place requirements, continued social distancing requirements, and limitations on large indoor gatherings which continue to impose substantial limits on our operations at this location,” Sarfraz stated in the WARN notice.

Future staffing needs are almost impossible to calculate given the uncertainties created by state and local authorities, the hotel stated.

Similarly, LSI-Silvercreek, operating as ClubSport and Sportsplex, said county and state officials have unleashed far too much uncertainty regarding the nature or scope of operations that would be allowed at the fitness club.

“LSI-Silvercreek was unable to gauge exactly what social distancing and other requirements the local county public health officials would impose on Sportsplex and ClubSport, if and when it does permit full reopening,” Jennifer Brown, a human resources executive with the company, wrote in the WARN notice.

The lack of clear guidance affected an array of options for Sportsplex and ClubSport.

“The company was unable to predict the type of services that it would be able to provide, the reduced number of clients that it would be able to serve under the county’s guidelines, or the actual number of clients willing to utilize Sportsplex or ClubSport once it re-opened under the county guidelines,” Brown stated in the WARN notice.

As a result, ClubSport and Sportsplex laid off a total of 139 workers, a July 28 WARN notice stated.

Danville-based Blackhawk Country Club has decided to lay off 58 workers, due to the discovery of a possible coronavirus exposure for one of the employees at the East Bay club and golf course complex.

“Blackhawk Country Clubs’s food and beverage operations have been temporarily suspended,” Kevin Dunne, the club’s general manager, wrote in the WARN notice. “This decision was made in response to a concern about a potential positive COVID-19 diagnosis.”

The club launched the layoffs, which are temporary, out of safety concerns, according to the WARN notice.

In San Francisco, Gap, which had previously disclosed plans to shut numerous retail stores amid a collapse in sales, a rent squeeze, and dispute with its landlord, had included its flagship store at Market Street and Powell Street in San Francisco in the closure plans.

But for the first time, Gap revealed how many workers would be affected by the shutdown of the San Francisco store.

“Approximately 79 employees are affected,” Joanne Rafferty, Gap senior director human resources, wrote in the WARN notice. The layoffs took place in early August.

Veritas Technologies, in a tech company layoff, said it was cutting 74 jobs in Santa Clara between late August and Nov. 30. The cuts were expected to be permanent.

A series of decisions by college sports associations to cancel live events with fans in attendance for a lengthy period of time prompted Chartwells to launch the layoffs of 56 workers at San Jose State University.

Chartwells also cited government orders to cancel large events for an unspecified period of time for the layoffs.

“While these actions are permanent, all terminated team members have been invited to apply for future employment as positions become available when business levels return following the pandemic,” Mrinalini Sen, human resources with Compass Group, owner of Chartwells, stated in the WARN notice.

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