Don't bite the hand that feeds you —

New Apple retail chief makes “mistake” in firing staff, hires them back

Changes are being reversed just ahead of an expected new hardware release.

Apple is reversing changes to the formula used to calculate staffing levels at its retail stores, according to a Dow Jones news report. An experiment using new formulas had apparently led to wide-ranging layoffs and cuts in assigned hours. However, Apple's new retail chief John Browett said the company "messed up" implementing the changes in the first place, and is hiring new staff to keep its stores prepared for a potential flood of customers next month.

Earlier this week it came to light that Apple Stores had been cutting staff hours, especially for part-time staff, and laying off many recent new hires. The changes came after Browett, the new SVP of retail, implemented a popular 25 percent pay raise for Apple Store employees when he took over for former SVP of retail Ron Johnson. Speculation suggested the changes were made to offset the increased costs of the higher pay.

That speculation seemed plausible given a recent New York Times article that suggested that Apple's army of retail employees were underpaid given the company's decidedly spectacular financial performance of late. Blog ifoAppleStore also cited sources that claimed Browett was—against advice to the contrary—trying to increase the retail division's profit margin by having all stores running "leaner."

The news comes shortly after a source close to Ars revealed that there was a company-wide wave of firings last week. The incident was related to employees taking advantage of stocks of replacement refurbished iPhone 4 models, which Apple had quietly begun replacing with iPhone 4S units. It seems Genius Bar staff were encouraging other employees, including managers, to claim their own personal iPhone 4 was malfunctioning, which a Genius would swap for a "free" upgrade to an iPhone 4S. Staff involved in such "trade-ups" were summarily shown the door.

It does not, however, appear that the dismissal of employees involved in phony upgrades and the general staff cuts were related. Still, it seems the latter "iPhone swap" firings may have exacerbated the ill effects of overall plans to cut staff.

But Apple is going back to its previous staffing levels, according to spokesperson Kristin Huguet. "Making these changes was a mistake and the changes are being reversed," Huguet told Dow Jones. "Our employees are our most important asset and the ones who provide the world-class service our customers deserve."

The mistake can't be a good one for Browett, who previously served as CEO of Dixons Retail before joining Apple earlier this year. During his time as CEO, Dixons Retail stock dropped over 50 percent. Dixons-owned electronics chains Currys and PC World (a British computer retail chain, not to be confused with the American publication) also suffered from poor customer service and product selection, with many customers describing the chains as the "absolute antithesis" of Apple's retail experience.

According to Dow Jones, Browett told store managers in a memo admitting the mistake that Apple would be hiring new retail staffers. The change in course comes just a month ahead of an expected new product rollout from Apple, which is believed to include a new iPhone model as well as a more compact version of its iPad tablet.

Channel Ars Technica