AUSTIN, TX — An Austin-based upscale cinema chain with a theater at The Domain has become the latest casualty of the coronavirus-stilled economy, alerting state regulators of its plans to lay off employees, according to a layoffs notice.
IPIC Theaters LLC alerted the Texas Workforce Commission of its layoffs of 37 workers as a result of slowed business. The notice was sent to the agency in adherence to the Worker Adjustment and Retraining Notification (WARN) Act designed to protect employees, their families and communities by requiring most employers with 100 or more employees to provide 60 calendar-day advance notification of plant closings and mass layoffs.
The company operates a theater featuring plush seating, gourmet light bites and cocktails, plus in-theater service, at 3225 Amy Donovan Plaza in upscale shopping center The Domain .
"This requirement was mandated due to the unprecedented effects of the COVID-19 pandemic, and the related government restrictions on businesses," Director of Human Resources Denise Arena wrote in an Aug. 13 letter to the Texas Workers Commission, a copy of which was secured by Patch. The layoff notice was in a batch of similar alerts statewide that were released to the media on Thursday.
Despite the layoffs and slowed business, company officials said they hope to return to full capacity once coronavirus subsides.
"While we have opened the theaters in some capacity, we continue to anticipate returning many team members to work and operating at full capacity at the location when the climate allows sometime in the future," the human resources director wrote. "As we navigate these unprecedented challenges and recent events, at this point, we cannot reasonably predict when that will occur.
Company officials initially had hoped the laid-off workers would be able to return to their jobs in short order, but that envisioned scenario is no longer feasible, Arena wrote regulators: "When we initially furloughed team members, we believed that we would be able to return them to work shortly after. That is no longer our working assumption as the timetable has been significantly pushed back due to circumstances and events beyond our control. While the company has not as of yet been able to open the theaters at full capacity, we remain committed to returning to pre-COVID capacity as circumstances permit."
Should that occur, Arena added, the affected workers will be asked to return to their jobs: "At that time, furloughed team members will be asked to return to work. Unfortunately, there is no specific timetable since the level of uncertainty surrounding the virus’s impact continues to change rapidly."
Financial exigencies spurred by the illness scourge have altered the company's operational plans, the human resources director wrote: "We must now take a variety of different actions due to the continuing unexpected effects and impacts of COVID-19. While we have now reopened in a limited capacity in some areas, the recent surge of COVID-19 cases and the new resulting government restrictions prevent us from resuming full operations and recalling team members at this time. First, for those team members who are furloughed, while we continue to hope the furloughs will be temporary, in light of the current and unexpected circumstances, we are now unsure when we will be able to return them to work on a consistent basis."
Given that uncertainty, some workers may lose their jobs permanently, Arena added: "Accordingly, effective Aug. 13, 2020, and in an abundance of caution, we want to let you
know that, although we still expect these furloughs to be temporary, we simply cannot predict a
return date at this juncture and their furloughs now may extend for an undetermined period of time, which at a minimum, will be six months. In addition, unfortunately, in light of the current and unexpected circumstances, the company will also be forced to conduct team member separations at this location. The team member separations in connection with this action will occur on Aug. 3, 2020. This action with respect to the separations is expected to be permanent."
She apologized to regulators for not having been able to provide more ample notice given the ever-changing set of business restrictions amid the growing reach of coronavirus: "The company and I personally regret that we were unable to provide to you more advance notice of this action. The movie theater industry has been hit especially hard by the health and economic outcome of the COVID-19 pandemic challenges.
"As a consequence, the state’s phased and evolving reopening plan has forced us to re-evaluate all our initial assumptions concerning getting back to normal. Beyond the State and local guidance, reopening protocols require changes in the way we do business. These new requirements pose challenges that are both unique operationally and structurally to our business model.
"Moreover, the surge of COVID-19 cases in Texas, and Gov. Abbott’s recent decision to pause the state’s reopening, make it clear that the impacts on the movie theater industry in Texas will be for an extended period of time and drastically impact the Company’s business and ability operate fully. After reviewing our staffing and business needs, we are providing this notice to you at the earliest possible time."