Employee Engagement

Waitrose has joined a growing list of firms accused of cutting perks for staff to help pay for the new national living wage. The supermarket – which is owned by John Lewis – has stopped paying Sunday and overtime rates for new workers.

Other firms which have taken similar steps with existing staff include Tesco, Morrisons, DIY giant B&Q, and homeware retailers Wilko and Dunelm. Sainsbury’s has also said it is ‘considering all options’.

Changes brought in on April 1 have forced firms to give staff on the minimum wage a 50p pay rise. All workers aged 25 and over must now be paid at least £7.20 an hour. The British Retail Consortium predicted the introduction of the national living wage could cost retailers between £1billion and £3billion a year.

And the change sparked bitter criticism from business groups which complain that the living wage puts an unfair burden on firms and is forcing them to cut their staff’s perks or even slash jobs. Pressure on companies trying to reduce the cost of the change will increase today when MPs debate the issue in the House of Commons.

Labour MP Siobhain McDonagh, who requested the backbench debate, said: ‘George Osborne guaranteed everyone a pay rise in his Autumn statement last November. People at the very least would expect they’d take home more rather than less.

‘The Government needs to do whatever it can to close this loophole and use its moral firepower to put pressure on firms.’ Many of the firms that have introduced changes to reduce costs – not paying staff for lunch breaks or cutting extra pay for Sundays and bank holidays – insist the changes had nothing to do with the introduction of the living wage. They say they are designed to iron out inconsistencies where staff are paid different rates for the same work.

But Labour MP Chris Leslie said Waitrose was chipping away at staff benefits and this could alienate staff and customers: ‘The living wage was supposed to be a big step forwards – but it sounds as though some firms are pulling the rug from under the feet of the lowest paid.’ John Mann, a Labour member of the Treasury Committee added that the firm was ‘giving with one hand and taking with the other.’

Waitrose – which employs 58,000 people – said its cuts were introduced in February and are not linked to the living wage. A spokesman said they were designed to bring it into line with its competitors and that its supermarket assistants are paid an average of £7.80 an hour – 60p above the living wage – regardless of age. He added: ‘Changes to premium pay for new starters is separate to national living wage implementation and was planned before the living wage was announced.’

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