Country Road Group staff are preparing for a restructure and expect imminent job losses

Staff at scandal-riven Country Road Group are bracing for job losses, and an external firm of psychologists and consultants has been brought in to repair its damaged corporate culture.

Staff at Country Road Group are bracing themselves for a company-wide restructure that is likely to lead to heavy job losses.

The embattled retailer, struggling to generate sales growth, has drafted in a consulting firm to repair its corporate culture that has been shredded by bullying and sexual harassment scandals.

Roy Bagattini, the chief executive of South Africa’s Woolworths Holdings which owns Country Road Group, made another visit to the Melbourne headquarters of the fashion house this month as he also seeks to mend bruised morale among staff.

His visit and the arrival of an external corporate culture consultancy, Sydney-based Bendelta, comes as many staff are still saddened by the departure last week of Country Road boss Elle Roseby, who was highly regarded by colleagues and seen as a strong defender of aggrieved employees who felt their workplace complaints were being ignored.

Corporate culture at Country Road Group, whose brands include Country Road, Trenery, Mimco, Witchery and Politix, could be about to take another knock as speculation within the Melbourne HQ grows that a major restructure involving job losses is approaching.

In May, Woolworths Holdings said the Country Road Group was being affected by inflated import costs due to a weaker Australian dollar coupled with higher fixed costs and that its trading position was worsening through calendar 2024.

For the first half of the 2024 financial year, Country Road Group recorded a 5 per cent slide in sales, Same-store sales dived 9.5 per cent.

Country Road Group staff at its Melbourne headquarters are bracing for a restructure and job losses. Picture Lachie Millard

The group has brought in consulting firm Bendelta to help repair its corporate culture, damaged by bullying and sexual harassment allegations swirling since late last year.

Bendelta styles itself as “strategists, psychologists and learning pioneers” that “apply scientific principles” to create “sustainable transformation”. It has a reputation as a “go to” consultancy to help repair corporate culture – and in 2020 it was reported that it had won a contract with corporate regulator ASIC to run a 360-degree feedback process whereby staff were are asked to assess their own leaders.

Bendelta staff have already begun meeting with Country Road Group employees. Many feel aggrieved that their initial workplace complaints were ignored or mishandled by senior management led by Country Road Group boss Raju Vuppalapati.

A spokesman for Country Road Group declined to comment.

In May The Australian revealed a sexual harassment and workplace scandal had arisen. Two executives departed and the global boss, Mr Bagattini, flew to Australia to address staff and announce an external investigation into the handling of complaints.

Country Road managing director Elle Roseby has left the company. Picture: Stefan Postles

Staff had complained of feeling unsafe, their complaints ignored. It led to an apology from Mr Bagattini and Mr Vuppalapati at a June meeting where both were openly jeered by angry employees.

In particular, staff were angry at a lack of accountability and punishment for Mr Vuppalapati – who had hired the two senior executives that later departed Country Road Group under a cloud and who was seen as being too close to them given he worked with both at his previous employer, country outfitter RM Williams.

Staff resentment grew at the June meeting over how Mr Vuppalapati had hand-picked former executive Rachid Maliki to join the company as its supply chain chief. The two had worked together at country apparel outfitter RM Williams. Mr Maliki departed Country Road in February in the wake of sexual harassment allegations.

Staff at the meeting pushed Mr Bagattini to explain why their allegations about Mr Maliki weren’t listened to, especially by Mr Vuppalapati, and why Mr Vuppalapati hadn’t been subjected to any consequences over the workplace scandal.

Country Road’s Chapel St store in Melbourne was plastered with protest posters. Picture: David Caird

Following allegations of sexual harassment and bullying, it is believed Mr Maliki was given two weeks’ leave as an investigation was mounted. He exited the business after only 19 months in the role.

A second executive and colleague of Mr Vuppalapati, Mehmed Mustafic, was also brought across from RM Williams but exited the business on March 21 after only 10 months in his role as general manager of sourcing and product development.

He faced allegations about the treatment of some staff members at the Burnley head office. These allegations did not include sexual harassment or sexually inappropriate conduct.

Woolworths Holdings held on to its Country Road Group business after it sold department store owner David Jones in 2022 to private equity investors for $100m.