LONDON (Reuters) - Sainsbury’s (SBRY.L), Britain’s second largest supermarket group, has bowed to pressure from employees and trade unions by changing some of the pay proposals it detailed in March as part of a move to simplify the company’s wage structure.
The group, which last month agreed a 7.3 billion pounds ($9.8 billion) takeover of rival Asda (WMT.N), employs 195,000 in Britain and Ireland and is the UK’s second biggest private sector employer after Tesco (TSCO.L).
Sainsbury’s said on Thursday that following a consultation process with staff representatives and unions it had agreed to increase unsociable hour premium payments, extend location pay supplements to staff working in all outer London areas rather than just inner London, and raise online driver payments.
It said the amendments would come at a cost to the business of over 10 million pounds ($13.4 million), in addition to the 100 million pounds it said the proposals would cost in March.
However, Sainsbury’s has maintained the main elements of its March proposals, including an hourly rate increase from 8 pounds to 9.20 per hour from September but the removal of payments for breaks and an annual discretionary staff bonus.
As a result of the changes over 121,000 employees will receive an average pay rise of 9.3 percent, said the firm.
Sainsbury’s said it would make top-up payments for an 18-month period to the around 9,000 employees who will not benefit from the changes.
Earlier this week around 100 UK lawmakers signed a letter to Prime Minister Theresa May criticizing Sainsbury’s proposals, claiming some employees could lose up to 3,000 pounds a year.
However, a spokesman for the retailer said fewer than 10 employees stood to lose that amount.
Reporting by James Davey; editing by Sarah Young