The U.S.-based operator of fashion retailer Forever 21 plans to lay off 358 people as it closes its Fashion District headquarters in downtown Los Angeles, the company said in a regulatory filing with the state’s Employment Development Department.
Forever 21 Chief Financial Officer Bradley Sell wrote in a Feb. 18 letter filed with EDD that workers at the company’s headquarters would be laid off permanently beginning April 21 and continuing through May 5, according to a federal Worker Adjustment and Retraining Notification.
WARNs are required when an employer lays off more than 50 employees or a significant percentage of its staff.
Sell didn’t provide details on how many workers would remain at the Forever 21 headquarters.
He wrote in the EDD letter that employees remaining with the company will be required to work remotely following the closure of the headquarters office.
“This information is based on the best information currently available to us, but may change due to subsequent events beyond our control,” said Sell, who has been CFO of the fashion retailer since March 2019 and is among the layoffs planned in April.
A Forever 21 spokesman wasn’t immediately available to comment on the layoffs or reports that the retail operator was preparing to close stores in anticipation of a potential bankruptcy.
The layoffs include managers, designers, supply chain directors and managers of product development and store operations. They also include Katrina Glusac, chief merchandising officer, and a handful of vice presidents in the offices of design and trend, general counsel, information technology and planning and allocation.
In December, CEO Winnie Park, who had been with Forever 21 since 2022, left to lead Five Below, a Philadelphia-based discount store chain that sells trendy items for tweens and teens.
The company, whose parent company in the U.S. is F21 OpCO LLC, has 58 stores in California, including several in the L.A. region.
Last week, Bloomberg reported that the U.S.-based operator of Forever 21 is preparing to close at least 200 more locations from the retailer’s shrinking store base as part of a bankruptcy process that’s expected to kick off as soon as next month.
The potential bankruptcy plan taking shape would seek a buyer for the retailer’s remaining stores, said Bloomberg sources who asked not to be identified discussing a private matter. If no qualified buyer emerges, they said, Forever 21 would liquidate the entirety of its 350-store chain.
The Forever 21 trademark and intellectual property are owned by apparel and lifestyle label empire Authentic Brands Group, which licenses them to the operating company that would undergo a Chapter 11 process, according to Bloomberg.
Authentic owns the SPARC Group, along with mall owner Simon Property Group and others.
Authentic’s ownership of the Forever 21 brand would remain intact through any bankruptcy process, the Bloomberg report said. Authentic plans to license the brand to other existing retailers and distributors regardless of the outcome of the U.S. operator’s potential sale or liquidation in bankruptcy, one of the people said.
Another of Authentic’s licensing brands, Liberated Brands, filed for bankruptcy and closed 100 of its stores under the Quiksilver, Billabong and Volcom labels.
Bloomberg contributed to this report.