Bunad crisis looms

Bailout packages demanded with new shutdown

Photo: Norske Bunader / NTB scanpix
April is the high season for the industry in Norway, but with new lockdowns, the industry finds itself in a crisis.

SNORRE SCHJØNBERG
NTB

Husfliden, one of Norway’s largest bunad retailers, fears that a new shutdown in Viken County, which encompasses the Oslo region, will lead to a bunad crisis. Husfliden is one of several chains whose management wonders why the government is closing them down without having crisis bailout packages in place.

At Husfliden, it is currently the high season for producing and delivering national costumes. Work is now in full swing to avoid the bunad crisis. This presents many challenges, since bunads are custom-tailored, and customers must try them on in close contact with the tailor.

“We have been very clear that the layoff rules we had last spring must be reinstated. When we are told in the evening to close down the next day, then the costs run large,” said CEO Per Willy Næsseth of Husfliden to NTB.

“We’ve now had an emergency meeting with several of the stores that had to close. We are trying to be as creative as we can with door-to-door delivery and home delivery to people who have placed their orders. We are working on a large e-commerce project as well,” Næsseth said.

Yet, he fears that many stores will fold because of the new closure.

“Of course, what we fear is the survival of our stores and keeping jobs secure; that’s all it’s about now,” he said.

Plans should have been in place
NTB has spoken with the CEOs of Husfliden, Kremmerhuset, and the electronics chain Elon. All three demand new measures from the government, including adjusting to two days the time an employer has to pay wages during layoffs.

They believe crisis measures should have been in place before Viken was closed down on a few hours’ notice on the evening of March 1.

“I think this makes sense, since you have to act fast. Our hope is that something will be put in place with a retroactive effect. That would be acceptable, of course, but if not, some of our stores will face big problems,” said Elon CEO Asle Bjerkebakke.

Virke estimates that up to 40,000 employees in their companies will be affected, while NHO states that their companies have 250,000 employees in the impacted sectors, and that many of these will be laid off.

Elon is laying off about 40 people in Viken in connection with the new closure. At Husfliden, it is not clear how many will be laid off yet, but here, too, impending layoffs have been announced.

The company directors are asking the government to cut down the time the employer has to cover the salaries for laid-off employees from 10 to two days. At the same time, Bjerkebakke points out that it will be impossible to comply with the requirement to notify employees if it is shut down upon only a few hours’ notice.

Twelve days of salary
“We have a duty to give two days’ notice before we lay anyone off, but that will be impossible now, so it will be 10 plus two days for which the employer must cover lost salary, in reality, 12 days,” said Bjerkebakke.

For stores that constantly have to close and open, there are many days that have to be compensated with full salary wages, despite income being significantly reduced.
Some stores are using home delivery and online order and pick-up, but it only makes up a fraction of the expected income.
“We have tried a bit with phone orders, but it has been almost insignificant,” said Bjerkebakke.
“It will not be able to replace our lost revenue, but it will compensate for some of the loss,” said Næseth.

Better conditions for employees
At Kremmerhuset, a home interior and décor retailer, about 100 people have now been laid off in connection with the new closure. Kremmerhuset confirmed that their online store makes up about 30% of a given store’s turnover.

“We would like there to be layoff compensation plans for both companies and employees, at least in cases when it is as unpredictable as it is now. It is tough for people to adjust to a lower level of wages, so when things are as unpredictable as now, compensation plans should be considered,” said Kremmerhuset’s CEO Vebjørn Torsetnes.

He also believes that the crisis packages should have been in place before the closure.

“I think maybe now that we have had this pandemic for a year, more crisis bailout packages and solutions should have been put in place. I understand that it is challenging, but it all seems a bit too ad hoc,” he said.

He emphasizes that Kremmerhuset had a good year in 2020 and is thus prepared to cope with the closure in Viken until April 11.

Translated by Lori Ann Reinhall

This article originally appeared in the April 9, 2021, issue of The Norwegian American.