-Hair salon operator Regis Corp. RGS, -5.64% said Tuesday it has temporarily closed all of its company-owned sales for at least two weeks, citing continuing uncertainties around the COVID-19 pandemic. The company, which salon brands include Supercuts, Cost Cutters and SmartStyle, also said it was furloughing a “substantial majority” of its workforce, representing about 485 employees across its corporate office, field support and distribution centers, starting on April 5 and lasting at least 30 days. Regis said it will pay a portion of benefits premiums during thie period. In addition, the company said it was cutting the chief executive’s wage by 60%, and wages of vice presidents and above by 30% and the wages of all other employees who will be working full time by 20%. “Given the still uncertain duration and severity associated with the COVID-19 pandemic we have taken additional, aggressive steps to preserve the financial integrity of our company and to protect the safety of our employees and customers,” said CEO Hugh Sawyer. The stock, which was still inactive in pre-market trading, has lost 64.6% over the past three months, while the S&P 500 SPX, -1.59% has declined 18.7%. Payback is a coming REGIS.
Category: Industry News
Mississippi no longer requires professional licenses for people who offer low-risk beauty services, a change that will save residents thousands of dollars and hours of time spent on training. House Bill 1312 was signed by Gov. Tate Reeves April 9, and it became law immediately. It removes certification requirements for people who work as eyebrow threaders, eyelash technicians or makeup artists.
The Mississippi State Board of Cosmetology previously required people who receive money for these services to earn an esthetician license. The license requires training and exams, but none of the training deals with applying false eyelashes or eyebrow threading, the technique of using a single strand of cotton thread to remove hair. The legislation was prompted by multiple lawsuits against the board. The first was filed in 2019 on behalf of eyebrow threader Dipa Bhattarai by Mississippi Justice Institute, the legal arm of the Mississippi Center for Public Policy, which advocates for free markets and limited regulation.
Bhattarai, now 26, was forced to close her eyebrow threading business in early 2018 after she received a citation for not having a license. She started her business while studying for an accounting degree at Mississippi University for Women in Columbus, as a way to help pay for school. Bhattarai learned eyebrow threading growing up in her native Nepal, where her aunt owned a salon. Bhattarai said there were few beauty service providers offering eyebrow threading when she opened her business. She started in a mall kiosk and soon expanded to two storefronts, in Starkville and Columbus. She served more than 3,000 customers in two years of business. When she had to close, four employees lost work. Bhattarai, who had just begun graduate school, lost thousands of dollars of business, all the while continuing to pay rent for her stores, which were under lease.
Mississippi Justice Institute director Aaron Rice said these kinds of regulations disproportionately impact the poor, minorities and young people. “A lot of times the people who are trying to get their start in life and get into the market or the workforce are young people who may not have an occupational license,” he said. “That barrier may be more than they can overcome in order to get into a work setting.” In 2020, Madison eyelash technician Amy Burks threatened litigation against the Board of Cosmetology after it threatened to shut down her business of five years because she had no license. Another lawsuit was filed by Fulton makeup artist Karrece Stewart in 2020.
Stewart said she was inspired to push for the law after hearing about Melony Armstrong, a Black woman who fought to get a law passed removing licensure requirements for hair braiding 15 years ago. “She told me what I needed to do to make my dream come true,” said Stewart, who said she spoke with Armstrong when preparing to file her lawsuit. Standing in her salon on Wednesday, Burks said she is grateful to be able to continue her work legally now that the law has changed. “For me personally, it was an integrity issue. It really bothered me to think that I was doing something illegal,” she said. “We have so many clients, and this has just been so overwhelming all the support that we have gotten.”
A L’Oreal class action lawsuit claims that the beauty giant’s shampoo and conditioner deceive customers into thinking they contain keratin.
According to plaintiff Tammy DeVane, the L’Oreal Paris EverSleek Sulfate Free Keratin Caring products are labeled, named, and advertised to trick reasonable customers.
The L’Oreal shampoo class action lawsuit claims that based on label representations, customers assume that the products contain keratin. However, the hair-nourishing ingredient is allegedly not present in the shampoo and conditioner. “Saying the products are ‘Keratin Caring’ when they contain no keratin, and repeating that representation with additional statements on the product labels and in a uniform advertising campaign, is unlawful,” DeVane claims. “Defendant’s mis-branding is intentional and renders the products less valuable, or even worthless.”
Keratin is a protein that naturally occurs in the hair, skin, and nails. The protein protects these parts of the body from damage and stress, creating a healthy, attractive appearance. Keratin is often used in hair care products due to its nourishing nature and many consumers look for keratin when purchasing shampoo and conditioner. L’Oreal allegedly takes advantage of the keratin reputation through marketing and advertising their “Keratin Caring” line in a deceptive way.
Product descriptions reportedly state that the Keratin Caring shampoo and conditioner “[care] for the essential protein and keratin that is found in hair.” These representations about the products’ keratin benefits are reportedly reflected in websites, promotional materials, and commercials. DeVane argues that L’Oreal heavily represents their products as containing keratin and that consumers trust the company’s advertisements. This reportedly results in consumers purchasing L’Oreal Keratin Caring shampoo and conditioner based on the belief that they contain keratin.
However, the L’Oreal class action states that because the products do not contain keratin, consumer purchases are proven to be worthless. DeVane claims that she and other customers would not have purchased the products if they had known that they didn’t contain keratin or would have paid less for the hair care products. “The absence of keratin and the failure of the EverSleek Keratin Caring Products to provide the claimed benefits of keratin leave no reason to purchase these products at all, since other proven and less-expensive products exist,” the L’Oreal class action lawsuit states.
DeVane seeks to represent a Class of consumers who purchased L’Oreal EverSleek Keratin Care shampoo and conditioner. She also seeks to represent two sub classes of consumers from New York and Florida, respectively, who purchased EverSleek Keratin Care shampoo and conditioner. The L’Oreal class action lawsuit seeks actual damages, statutory damages, restitution, disgorgement, interest, court costs, and attorneys’ fees. DeVane and the proposed Class are represented by Taylor Bartlett and Caroline Hollingsworth of Heninger Garrison Davis LLC.
The L’Oreal Paris EverSleek Sulfate Free Keratin Caring Shampoo and Conditioner Class Action Lawsuit is DeVane v. L’Oreal USA Inc., Case No. 1:19-cv-04362, in the U.S. District Court for the Southern District of New York.
The hair industry has been one of the most affected sectors from the pandemic and the National Hair & Beauty Federation’s (NHBF) latest report shows turnover falling by 45% in 2020, compared to 2019.
Due to social distancing restrictions, salon capacity fell to 70% of what it was before the pandemic began, with hair businesses losing on average two hours of appointment time per stylist per day, the report found.
The average cash loss to a business in 2020 was £17,000, with those over the VAT threshold taking an even bigger hit, and one in 10 businesses did not return any income or dividend to their owners or managers, the data revealed. Full-time employment in the sector is also down 21% on 2019 figures.
As such, the NHBF states that there are now many hair and beauty businesses which are acutely vulnerable to failure in the next 12 months, especially as 2021 is expected to be just as tough a year as 2020. Without further support from Government, most expect to survive two-to-three months (from January 2021) if coronavirus lock-down continues, the NHBF’s report states.
The report also revealed that the Covid-19 crisis has a disproportionate impact on women and those in deprived communities – for example, hair and beauty business owners are 82% female, with an 88% female workforce.
There is also a higher proportion of personal care businesses than any other sector in the most deprived areas of the UK, with closure of these places posing a risk to those in the local community who are most likely to be employed at these salons.
Reducing VAT to 5% would add £16,000 to the average VAT registered business, closing the cash gap by one-third, states the report. This would reduce to 6% the proportion of businesses not returning anything to their owners or managers.
If 18% of the businesses which would have otherwise failed survive as a result of reducing VAT to 5%, then the policy pays for itself through the taxes they will pay.
Talking about the NHBF’s report findings, chief executive Richard Lambert said: “While the future could be bleak for the personal care sector, intervention now and immediately following reopening will have a life-changing positive effect. There’s nothing coming in, but the overheads still have to be paid. When we are closed, we are closed. We can’t diversify into takeaways and online sales.
“The personal care sector is calling for a specific grant to support businesses through the immediate cashflow crisis, in line with similar funds that have been afforded to many other sectors, including the arts, hospitality and leisure, and the aeronautical industry, among others.”
He added: “We also need support after reopening to keep cash in these businesses so they can recover. The bigger businesses have been hit the hardest and are now the most vulnerable to failure. A targeted VAT cut to 5% would allow them to re-build, invest in staff and apprentices, and once again be the heart of their high streets and communities. We’ve shown this move will pay for itself, so it’s a cost-effective solution for the Government.
“Right now, it feels like we are last in line for support, flippantly disregarded within Parliament and overlooked by Government, despite the billions of pounds we contribute to the economy each year.”
The NHBF has been working with the British Beauty Council (BBC), British Association of Beauty Therapists and Cosmetologists (Babtac) and the UK Spa Association (UKSA) to lobby the Department for Business (BEIS), the Treasury and the Cabinet Office for an urgent Personal Care crisis fund and a reduction in VAT.
Tessica Brown said she had run out of her usual hair spray one day and made the decision to use the Gorilla Glue spray in the interim. As Brown explained, weeks had passed at this point and her hair was still not able to move. “My hair, it don’t move. You hear what I’m telling you? It. Don’t. Move,” she said at the time. “… So I’m tell you like this: If you ever, ever run out of Göt2b Glued Spray, don’t ever use this. Unless you want your hair to be like that forever.”
Over the weekend, Tessica Brown said to her followers on instagram that she was paying a visit to the St. Bernard Parish Hospital in Louisiana. Brown said hospital staff attempted to use nail polish remover and saline water on her head, which caused a burning sensation. “It burned so bad my heart started beating too fast,” she recalled, noting that she ultimately chose to check herself out instead of going through with 20 hours of this attempted remedy. From there, the aim was to continue that treatment from home, though that’s apparently not resulted in progress so far.
She shared an update on Instagram confirming she “will be leaving tomorrow to go see a surgeon.” She thanked those sending her love and shrugged off folks making jokes about her. “I really do love and appreciate everybody I mean everybody that truly has my back.” Hair experts and medical professionals alike have all tried to come together over the last few days to try to find a viable solution for Brown. Some of their suggestions have included using rubbing alcohol and acetone to break down the glue, and Brown even made a trip to the ER. However, nothing so far has been able to help dissolve the adhesive.
Tessica Brown has hired an attorney and is said to be weighing potential legal options in connection with the adhesive spray incident. Per their report, Brown felt that the labeling on the product which is said to have mentioned not using it on eyes, skin, and clothes was misleading. The Gorilla Glue brand released a professional statement via Instagram on Feb. 8, sending their well wishes to Brown. However due to the nature of its product’s use, they were not able to provide any help. “We are very sorry to hear about the unfortunate incident that Miss Brown experienced using our Spray Adhesive on her hair,” the company captioned the post. “We are glad to see in her recent video that Miss Brown has received medical treatment from her local medical facility and wish her the best.”
Days after going viral for the incident, the Beverly Hills plastic surgeon who offered a free procedure (worth an estimated $12,500) to Tessica Brown made good on his promise. “She’s been through a lot and I hope that you guys will learn from Tessica’s injuries or Tessica’s ordeal,” Dr. Obeng said. “Make sure that any time you guys grab something, make sure you read it.” Brown is planning to fly California on Wednesday to start the process, according to the publication. And while the removal is estimated to cost around $12,500, Dr. Obeng is reportedly providing the service pro bono.