AUSTIN, Texas — Bad news continued to besiege Whole Foods Market last week, as the company said it would lay off 49 employees at its headquarters here, according to local reports.
In addition, the company escalated a massive ground-beef recall and took a step deeper into its antitrust showdown with the Federal Trade Commission.
The news of the staff cutbacks comes after the formerly fast-growing chain earlier this month reported the weakest comparable-store sales growth in its history and announced a sharp cutback in new-store development. It also slashed capital spending and suspended its stock dividend, sending its shares to new lows.
The company could not be reached for comment last week on the layoffs. It was not clear what areas of the company the cutbacks are impacting. In the reports, Whole Foods was quoted as saying the 49 jobs to be eliminated were among the “650 positions that report to the global headquarters in Austin.”
Meanwhile, the FTC moved ahead with its effort to launch an administrative hearing against Whole Foods' acquisition of Wild Oats Markets, a deal that was completed nearly a year ago. A Sept. 8 date was set to begin scheduling the administrative proceedings, which the FTC said it can continue to pursue despite having failed to obtain a preliminary injunction against the merger. Late last month the FTC won its appeal of the District Court's decision to allow the merger.
Whole Foods has 45 days from the date of that ruling — until about Sept. 12 — to file an appeal for what is called an “en banque” hearing before the full Court of Appeals.
In the beef recall, Whole Foods initially reported on Aug. 8 that it was recalling in 27 states, Canada and the District of Columbia fresh ground beef that it had ground itself from cuts supplied by Coleman Natural Beef, after reports of E. coli contamination. Whole Foods indicated that the cuts had been processed through the same company, Nebraska Beef, that had been involved in another recent beef recall. Then last week Whole Foods expanded the recall to additional stores in the Rocky Mountain Region after Nebraska Beef expanded its recall to 1.2 million pounds, most of which Whole Foods said was sent to other retailers.