US retailer GameStop forced to close in US state despite claiming it is an ‘essential business’

Retailer GameStop has been ordered to close its stores in the state of Massachusetts.

As reported by The Boston Globe (thanks, Polygon) – and despite claims from the company’s management that the video game retailer is an “essential business” because it sells “products and devices that are important to facilitate remote work, distance learning, and virtual connectivity” – state officials ordered the chain to close last week.

In an article headlined “After instructing employees to wrap their hands in plastic bags and go back to work, GameStop shuts down Mass. stores”, employees told The Globe they had received correspondence from management instructing them the stores would remain open for “curbside pickup” and to “wear gloves or even tape plastic bags over their hands, open the front door only slightly while keeping its glass between them and the customer, and handing over whatever they had ordered through the crack”.

At the time of writing, GameStop has not expanded on how the forced closure will impact its business across the rest of the US, or the other countries in which it operates, including Austria, Denmark, France, Germany, Ireland, Italy, Norway, Switzerland, and Sweden.

GameStop recently confirmed it is closing 320 “or more” stores over the next 12 months, just months after the retailer closed 320 stores at the end of the last fiscal year. Now, at least another 320 of its 5,500 global stores are also at risk of closure, too, despite the company reporting a net income of $21 million (£16.8 million) at the end of the last financial period in February 2020.

As part of a “workforce reduction”, GameStop laid off more than 120 people at the end of last year, including almost half the editorial team employed at its subsidiary magazine, Game Informer. The cuts affect staff working at the company’s corporate headquarters in Grapevine, Texas and Game Informer’s HQ in Minnesota, and equate to almost 14 per cent of its global workforce. 

“As part of the previously announced GameStop Reboot initiative to transform our business for the future and improve our financial performance, we can confirm a workforce reduction was implemented impacting more than 120 corporate staff positions, representing approximately 14 per cent of our total associate base at our company headquarters as well as at some other offices,” a GameStop spokesperson said at the time.

In the UK, and following the government shutdown that forced non-essential retailers and hospitality businesses to close as part of its effort to contain the COVID-19 pandemic, UK specialist retailer GAME has furlouged its staff.

A week after the enforced shutdown, GAME staff received an email from owner Mike Ashley’s Frasers Group stating employees would be furloughed on full pay until the end of April. The letter added that it could not guarantee pay nor job security past that date, but did say payment would be based on average earnings and not contracted hours, as the latter is typically less than most colleagues actually work. For those who remain employed at the company post-April, they will receive 80 per cent of their salary as per the government’s Coronavirus Job Retention Scheme.