Tim Martin's Wetherspoons prepares to re-open pubs in England with help of £48m state loan

Tim Martin, boss and founder of the JD Wetherspoon chain, announced he would be opening 750 of his pubs in England – while venues in other parts of the UK, including Scotland will remain closed.

The pub chain has drawn up a safety plan, following a consultation with employees, which was announced last month.

The £48.3m loan was secured under the government's Coronavirus Large Business Interruption scheme (CLBILS) - after the company had taken advantage of the state furlough scheme.

Mr Martin said: “We are extremely pleased that pubs are reopening on July 4 after a long hiatus.

“We are going to discuss the precise Government proposals with our pub managers and staff before we comment further on the details.”

In September, the pub giant made £102.5m profit - £5m less than the previous year.

Mr Martin said at the time: "JDW continues to perform well. Like-for-like sales for the six weeks to September 8, 2019 were up 5.9%."

The outspoken Wetherspoon chief had faced criticism for once playing down the risks of people gathering in pubs during the pandemic at the time and insisted that the government was wrong to shut them down.

In March, in the aftermath of Boris Johnson announcing the coronavirus lockdown, it emerged the pub chain denied it was “abandoning” its 43,000 staff and insisted it could not afford to pay them during the Covid-19 crisis until the company was reimbursed for their wages by the government.

Details of the loan which were confirmed on June 24.

He angered workers and MPs after sending a video message to staff a few days before the official lockdown indicating they would no longer be paid while the company works out details of a “furlough” scheme under which the government will pay 80% of wages.

He hinted they could seek work in Tesco, which was hiring staff to help it meet the country’s need for food delivery and distribution, if they needed employment in the meantime.

Mr Martin, who donated £50,000 to Boris Johnson's General Electon campaign said at the time: “Companies like Costa, owned by Coca-Cola, and McDonald’s, being owned by large multinationals, can afford to retain staff and commit to paying them, before details of the government furlough scheme are published.

“However, they are in a minority in the pub and restaurant trade. Most companies, including Wetherspoon, do not have the resources, while pubs are shut, to make this commitment and need to see details of the scheme in order to retain and pay staff, as the government has sensibly requested, rather than instigating large-scale layoffs.

“That may seem stark, but that’s the economic reality of the unprecedented situation in the UK today.”

But in a separate statement, Wetherspoon had blamed a “complete misinterpretation” of its message to staff, although it did not dispute that they would cease to be paid after Friday while details of the furlough scheme were finalised.

“As we understand it, tens of thousands of hospitality workers and others have already lost their jobs, but Wetherspoon is retaining all its employees, using the government scheme for the purpose for which it is intended,” said a spokesperson.

“Wetherspoon chairman Tim Martin said to employees in a video that supermarkets were urgently looking for staff, since all trade from pubs, restaurants and cafes had transferred to supermarkets in the last few days.

“Wetherspoon has had urgent calls from supermarkets asking for help in recruitment. Tesco alone urgently needs 20,000 staff, we understand. Tim Martin said in the video that staff who wanted to work for Tesco should do so and they will be given first priority when Wetherspoon pubs reopen.

“Wetherspoon believes that the actions it has taken are responsible and sensible in the difficult circumstances.”

Mr Martin, who played a leading role in campaigning for Brexit and as the City's most outspoken critic of the EU, had been hoping for forecast sales for the year to July 26 to rise to £1.9billion, up from £1.8billion.

 Mr Martin's pub chain took the unusual step on May 7 of publishing corrections the business magazine Forbes had made to the stock exchange about its actions post-lockdown.

It said that articles published online on March 27 and May 3 2020, made a number of what it called "factually incorrect statements" regarding the company.

It said it was alleged that the company told the "workforce that not only would they not be paid, but they can trot off to get a job in a supermarket".

The pub chain said: "As regards pay, a company video, recorded on Sunday March 22 actually said, 'all our endeavours are going to be on trying to make sure that you get your money and that the pubs reopen'."

Wetherspoons published the transcript.

The pub chain stated: "An email, sent out with the video, said: 'All hourly paid employees will be paid as normal on Friday March 27 for all hours worked up to, and including, Sunday 22 March 2020'.

"Staff were paid on that Friday and have been paid on every Friday since.

"The statement in Forbes that staff were told they could 'trot off to get a job in a supermarket' is misleading.

"The video actually said, 'if you're offered a job in a supermarket, many of you will want to do that. If you think it's a good idea, do it...I promise you, we'll give you first preference if you want to come back'.

"Forbes also said that the company 'announced that... pubs WILL (Wetherspoon capitals) open sometime in June'. That is also incorrect.

"In a stock exchange announcement on 29 April, Wetherspoon said, 'the company's current assumptions are that its pubs will remain closed until late June 2020'.

"The assumptions related to the modelling of two financial 'scenarios', for the benefit of investors, which necessitated an estimated opening date.

"The date was only an estimate and the company made clear that it would only open when permitted by the government."

The  video transcript published by Wetherspoons.

Hi everyone, I'm very sorry about the situation that's occurred with our pubs, they've been shut, as you know, unprecedented in the last 40 years and it puts everyone in a terribly difficult position. I know you're all sitting there wondering what the hell's happening. Over the weekend I've had lots of phone calls with different people and we're trying to sort it all out as best we can in this highly unusual situation.

The good news is that the government has undertaken to underwrite people's wages for an indefinite amount of time, which is great as we have no money coming in through the tills, which is not something that we ever planned for as you can appreciate. The government's promised to pay about 80% of wages, they will probably be pretty slow about paying it so there may be some delays, for which I also apologise, but I feel sure they're going to come through on their promise.

Our main aim and my main aim is to reopen. We employ over 40,000 people so it's very important for them, just as important perhaps for the country is Wetherspoon, you, thanks to you, pays 1,000th of all taxes, so it's very important to the country that we reopen. It might be weeks, it might be months, tremendous pressure on us all because of the uncertainty, apart from all the practical considerations, so all our endeavours are going to be on trying to make sure that you get your money and that the pubs reopen and I know that almost all of our trade now has gone to supermarkets, not only our trade but the trade from cafes, leisure centres, restaurants etc.

We've had lots of calls from supermarkets, Tesco alone want 20,000 people to join them, that's half the number of people who work in our pubs. If I'm being honest I say you can get the furlough payments and stay at home, if you're offered a job in a supermarket many of you will want to do that, if you think it's a good idea do it, I can completely understand it. If you've worked for us before I promise you, we'll give you first preference if you want to come back. We will obviously completely understand that you don't want to wait around for us to reopen.

Deeply appreciate your work, I've just so much enjoyed talking to you in my pub calls.