RETAIL RETRENCHMENT

Hudson’s Bay lays off 265 head office workers across North America, including in Toronto,

Hudson’s Bay Company is cutting 265 jobs in corporate offices across North America, including in Toronto.

The giant department store chain, founded in 1670, announced the decision Tuesday, noting it will take a $20-million charge in the third quarter as a result.

A company spokeswoman said it will not affect any sales associates who work in the stores, emphasizing the layoffs will hit those who do corporate functions such as accounting, finance and IT. She declined to say how many jobs will be lost in Toronto, but said the majority are in the U.S. Employees were told on Tuesday, with some positions cut immediately and others phased out.

The move comes two years after Hudson’s Bay acquired luxury retailer Saks Inc., and the accompanying brands Saks Fifth Avenue and Off 5th. Hudson’s Bay had earlier acquired the chain Lord and Taylor.

Maureen Atkinson, senior partner at J.C. Williams, a retail consulting firm, says the layoffs are not a surprise. “When you amalgamate companies, there would probably be duplication of work,” she said. Noting that Hudson’s Bay has 45,000 employees, she said this cut represents a small portion of the workforce.

“It is painful for people going through this, but the (stock) market likes to see that expenses are being cut,” Atkinson said.

Hudson’s Bay shares closed in Toronto at $20.73, up $1.28, or more than 6 per cent.

The changes are expected to bring an annualized cost savings totalling $75 million in the 2016 fiscal year.

Next year, the company plans on opening seven Saks Fifth Avenue locations and 25 Off 5th locations.

Saks Fifth Avenue stores are scheduled to open in early 2016 at the Toronto Eaton Centre and Sherway Gardens.