John Lewis warns on job losses due to its commitment to staff pay

Helen Cahill
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John Lewis See Profits Sink Due To Property Slump
Many retailers have been struggling with the introduction of the national living wage (Source: Getty)

The John Lewis Partnership warned this morning that it may be losing staff "over time" due to its paying its employees higher than the government-imposed national living wage.

The company committed to paying workers "well above" the new national living wage, but said this had landed it with £33m in extra costs. If the department store had complied with regulation, its would have been £3m higher than the year before.

In its interim report for the half year ending 30 July, John Lewis said: "However, high pay depends on better productivity and greater contribution and we anticipate that this will mean we will have fewer partners over time as compared to today."

Read more: Knowingly undersold? John Lewis profits fall - but not because of Brexit

Chairman Charlie Mayfield said today: "If you can achieve more in every single job, you don’t need as many people."

The retailer also announced this morning that profit before tax and exceptional items fell 14.7 per cent to £81.9m in the six months to the end of July, despite a 3.1 per cent rise in gross sales, to £5.27bn.

John Lewis admitted today that market conditions had been tough - but highlighted that this wasn't due to the Brexit vote, which chairman Charlie Mayfield said had "little quantifiable impact on sales so far".

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