The delayed paychecks were the result of a “cyber incident,” according to a company-wide email that was sent by Barneys’ corporate HR to all employees on January 3 and that was obtained by Business Insider. At the time, employees were informed they were “likely to be paid” on Thursday, January 9.
“As you may already know, earlier this week the company experienced a cyber incident that has caused a major disruption to all systems companywide,” the email reads. “Unfortunately, it has also impacted the company’s ability to process payroll by the normal deadlines established by ADP.”
A Barneys sales associate — who works at the downtown store on 7th Avenue and requested anonymity to protect her employment status — told Business Insider she is “enraged” and remains skeptical that the payments will process Thursday as promised. As a result of the delay, she has been unable to pay her bills, and one of her accounts is overdrawn, she said.
“There is no morale,” she said. “People have been leaving at an exponential rate and I know a lot of the managers have been worried about not having enough people on the floor and about us not going in — especially now, because hey we’re not getting paid, so why would we?”
According to the employee, staffers were asked to manually clock in and out and track their own commissions.
On Tuesday morning, issues with point-of-sales systems caused delays in opening the 7th Avenue store. Though the staffers were later able to open the store and process sales, they had to take additional steps that slowed down business as the team continues to work through the liquidation period.
The source of the hack currently remains unknown, and in response to a request for comment a spokesperson at Authentic Brands Group said it is “not in the position to comment,” adding that “ABG is the owner of the intellectual property of Barneys and did not purchase the inventory or store leases in the acquisition.”
Representatives for B. Riley Financial, the company that has been overseeing the Barneys liquidation and transition process, also declined to comment.
Here’s the full email:
Subject: PLEASE READ! Important Payroll Update
Happy New Year!
As you may already know, earlier this week the company experienced a cyber incident that has caused a major disruption to all systems companywide. Unfortunately, it has also impacted the company’s ability to process payroll by the normal deadline established by ADP.
As a result, this wee’s payroll will not be paid pursuant to the normal weekly pay cycle and will likely be paid next Thursday, January 9, 2020 (unless the systems are able to be recovered sooner, in which case we will pay as quickly as possible).
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