Sainsbury’s is increasing basic pay for its shop-floor staff but axing paid breaks, premium pay for Sundays and an annual bonus – resulting in a pay cut for some staff.
The supermarket group said most staff would 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 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.
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 trade union Unite accused Sainsbury’s of “robbing Peter to pay Paul” and said it would urge its members to vote against the plan in a consultative ballot.
The £9.20 basic rate of pay is above 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 Lidl and the £8.85 paid by Aldi.
Sainsbury’s new London rate of £9.80 an hour is lower than the independently calculated London living wage of £10.20, which is also Aldi’s minimum rate for the capital.
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”.
Unite, which has 12,000 members working at the supermarket, welcomed the £9.20 basic rate of pay as a positive move. But the acting national officer for food and drink, Bev Clarkson, said: “We are in a classic ‘robbing Peter to pay Paul’ situation, which we don’t think will benefit our members in the long run.
“There will be no further increase in salary until 2020 and given what our members have been asked to give up in return for this headline rate, the overall package doesn’t look that attractive. We are recommending rejection and will decide on the next steps after our members have expressed their views in the consultative ballot, which should be known by the end of April.”
The move comes as Sainsbury’s struggles to compete in a fast-changing grocery market. The retailer was the worst-performing of the four biggest grocers in the three months to 25 February, according to market share data from Kantar Worldpanel. 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 too 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.”
