Sainsbury’s is increasing basic pay for its shopfloor staff by but axing paid breaks, premium pay for Sundays and an annual bonus – resulting in a pay cut for some staff.
Most staff will receive about an 8% rise in annual pay, after accounting for the removal of a half-hour paid break every eight-hour shift and a 15- minute paid break for seven-hour shifts. That increase does not take into account the removal of the performance-related bonus from non-management staff, which can amount to hundreds of pounds.
Longer-serving staff who currently receive time and a half for working on Sundays may see their pay fall. But the supermarket said those affected would receive top-up payments to ensure no one was paid less for the next 18 months.
Higher food prices sap British consumer spending
Sainsbury’s said it was spending £100m on improving pay and the vast majority of staff would see more in their pocket. It said the latest pay rise to £9.20 an hour, or £9.80 in London, came after three years of 4% pay increases.
The £9.20 basic rate of pay is well ahead of the government’s legal minimum of £7.50 for over-25s and £7.05 for 21- to 24-year olds. It is also more than the independently calculated living wage of £8.75 an hour paid by rival retailers Aldi and Lidl. Sainsbury’s new London rate of £9.80 an hour is lower than the independently calculated London living wage of £10.20 an hour.
Simon Roberts, the Sainsbury’s retail and operations director, said: “The retail sector has never been more competitive and we know that our customers really value our colleagues and the excellent service they provide in our shops.
“Which is why we think it is so important to invest further in our colleagues so they feel rewarded and motivated to do the best possible job for our customers every day.”
The company said all 130,000 store staff would be put on new contracts “ensuring consistency and fairness across all stores, regardless of age or length of service”.
The move comes as Sainsbury’s struggles to compete in a fast-changing grocery market. The supermarket was the worst-performing of the four major grocers according to market share data from Kantar Worldpanel for the three months to 25 February. Its sales rose by just 1.1%, compared with 2.7% growth at Tesco and Morrisons and 2.3% at Asda.
Joanne McGuinness, the national officer for Usdaw, the shop workers’ union, said it would be looking closely at the deal: “Usdaw has long been making the case for the real living wage and beyond, so this deal takes Sainsbury’s staff 45p per hour above that £8.75 rate.
“While this is welcome news for Usdaw members working in Sainsbury’s, we will be looking closely at the whole deal. We want to check the effects on all individual workers. We will now enter into talks with the company.”