Controversy Erupts as Asda Contemplates Pay Reductions for Thousands of Employees

Controversy Erupts as Asda Contemplates Pay Reductions for Thousands of Employees

...By Muyiwa Aderinto for TDPel Media.

Asda’s Pay Cut Proposal Sparks Outrage Among Workers’ Unions

The passage discusses supermarket chain Asda’s consideration of pay cuts for 7,000 staff members who have historically received higher wages to compensate for the higher cost of living near London.


The proposed changes, set to take effect in November, would impact employees at 39 stores located outside the M25, resulting in a pay reduction of approximately 5% if implemented.

Workers’ unions, such as the GMB, strongly criticize Asda’s plan, labeling it “inexcusable” given the current cost-of-living crisis.

The union warns that employees who refuse to agree to the new terms could face termination.

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Asda’s spokesperson highlights that all staff members recently received a 10% raise to help them cope with the escalating cost of living. However, according to the GMB, the supermarket may eliminate the “location supplement” of 60p per hour and reduce the night supplement.

Since being acquired by billionaire brothers Issa and private equity firm TDR Capital in 2020, Asda’s new owners aim to cut costs as debt burdens increase.

They are reportedly exploring a merger with EG Group’s UK petrol stations, which are also owned by the Issa brothers.

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The GMB’s Nadine Houghton expresses concern that the proposed merger could lead to further cuts, characterizing the current pay reductions as preparatory measures.

She calls on the government to intervene and prevent the merger from proceeding.

In response, an Asda spokesperson clarifies that the consultation would only affect a limited number of stores where employees receive the 60p location supplement on top of the national rate of £11 per hour.

They argue that this supplement creates inconsistencies in pay among employees working in close proximity.

Asda is also discussing potential compensation for removing the 60p supplement.

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The supermarket recently increased the pay of all hourly shop-floor workers by 10%, setting a minimum wage of £11 per hour in April, and plans to raise it to £11.10 per hour in July.

In addition to the pay cut proposal, Asda has been conducting a trial of “driverless” delivery vehicles, which are manned by two individuals to ensure safe navigation and doorstep delivery.

Picture shows EG Group founders Mohsin, right, and Zuber Issa in Blackburn Nov 13, 2019
The company emphasizes its commitment to technological innovation in the online grocery sector and improving delivery options for customers.


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