Dominick’s, the Chicago-area supermarket chain of US grocer Safeway, has laid off 500 of its near 13,000 workers and is to close a store in East Chicago.

Dominick’s, which recently resolved a labour dispute with its workers, said the closure and job losses were due to sluggish sales.

The chain declined to comment on rumours that it may close as many as 20 stores after the holidays, reported the Associated Press.