Clarke cuts Tesco store manager bonuses

The Daily Mail reported that around 5,000 store managers and executives were sent a letter by Clarke last week to inform them of the cut.

Those affected receive annual performance-based rewards and will lose out after a poor year for the grocery giant in which it delivered its first profit warning for 20 years in January.

The scale of the fall in bonus is understood to have taken staff by surprise, full details including bonuses on the company’s board will be revealed in its annual report, released next week.

The average member of Tesco’s top 5,000 staff received a £12,000 maximum bonus last year but this year it is expected to drop to £2,000 to £3,000.

Clarke said in the letter: “Last year was a difficult one despite delivering another record set of results.

“The group missed its profit targets and had a mixed performance across our six corporate objectives - we missed the threshold for UK return on capital employed and our UK like-for-like sales target.

“Following a review of our performance for 2011/12, the executive committee has approved an award of 16.9 per cent of your maximum bonus.”

The letter was sent last week to everyone from senior store managers up to the management tier just below the board.

A Tesco spokesman said: “Tesco’s top 5,000 leaders, including the executive directors, all have genuinely performance-linked incentives and these are closely aligned.

“We will announce full details in our annual report published later thism onth and those at the top of the company will take their share of the impace of last year’s results.”