Monday 29 April 2019 3:00 pm

MPs to ramp up pressure on Asda over ‘appalling’ wage shake-up plans


Reporter covering retail and property. Email stories to seb.mccarthy@cityam.com

Reporter covering retail and property. Email stories to seb.mccarthy@cityam.com

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Asda is set to face fresh pressure from politicians this week amid accusations that new pay proposals could leave thousands of workers financially worse off.

Read more: Watchdog kills Sainsbury's-Asda merger: What went wrong?

A campaign addressed to Asda demanding the grocery giant rows back on "unscrupulous contract changes" is set to be backed by a number of MPs in a bid to halt the changes.

Labour MP Siobhain McDonagh has written a letter for politicians to sign that accuses Asda of using a set of potential contract changes for its workforce as a “smokescreen” for unpaid breaks and shortened night shifts.

In a scathing letter addressed to Asda boss Roger Burnley and seen by City A.M., McDonagh wrote: "We warmly welcome the pay rise that some of your employees will receive under these proposed changes. However, we are utterly appalled that this is to the detriment of 3,000 of your staff who are set to see their wages slashed."

She added: "We are completely dismayed that a company of your reputation would use an increase in basic pay as a smokescreen to cut the pay of so many of your most longstanding staff."

McDonagh, who has warned that the changes would make 2,700 staff members up to £500 worse off every year, told City A.M. that she already has the support of several well-known MPs and is hoping the petition will attract cross-party backing.

Her letter concludes: "We encourage you to ensure that no Asda employee receives a pay cut under these proposals and we hope that that you show to them a fraction of the loyalty that they have shown to you."

The damning remarks come less than a week after the UK's competition watchdog blocked Asda's planned £7.3bn tie-up with Sainsbury’s, ruling that the merger would have led to higher prices for consumers.

The grocery firm recently announced a set of potential contract changes for its workforce, pledging to hike the basic hourly rate of pay for retail employees.


In a letter of response to McDonagh’s accusations earlier this month, Asda boss Burnley said: "As a retailer, our job is to serve our customers’ needs. That means we need to have the right colleagues in the right place at the right time. As our customers change the way that they shop, we need to ensure that we have the flexibility to change with them in order to remain competitive."

Read more: Asda contract changes could leave 3000 staff worse off, MP claims

An Asda spokesperson added: "We are currently consulting with our colleagues and their representatives over a proposal to invest in an increased rate of pay and changes to terms and conditions, which would enable us to deliver better service to our customers in an intensely competitive marketplace and would make 95% of our colleagues financially better off. This consultation is ongoing and we will always have conversations about change with our colleagues first."

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