Asda accused of threatening to cut thousands of workers’ pay

The supermarket chain is set to tell workers at 39 stores across the South of England that they will lose their 60p-per-hour location supplement and have their night supplement reduced.

Workers who do not agree to the pay reduction will require a new contract and could be fired if they refuse to sign. 

A consultation is now taking place, with plans to introduce the new changes in November.

GMB says this is “an example of private equity slash-and-burn tactics to pave the way for Asda’s potential £11bn debt merger with EG group” and has dubbed the decision to cut pay as “inexcusable”.

GMB organiser Nadine Houghton added: “Cutting the pay of 7,000 low-paid, retail workers during a cost-of-living crisis is inexcusable. 

“The billionaire Issa brothers and their business partners, the multi-millionaire elite private equity fund managers in TDR Capital, are restructuring Asda in preparation for the debt-laden merger they are trying to push through with EG Group. 

“If the business secretary allows this merger to go ahead, she will be responsible for allowing a deal that is bad for workers, bad for consumers and bad for the high street. 

“These slash-and-burn tactics, along with food and fuel price increases, will only ramp up if the merger goes ahead. TDR and the Issa brothers will be using Asda’s revenues to pay off their debt mountain – this is money that should be invested in stores, colleagues and ensuring proper competition in pricing. 

“Asda’s workers and consumers should not bear the brunt of financial engineering from private equity.” 

A spokesman for Asda said the union was being “premature” with its accusations, and that the consultation was announced in February and involves stores outside the M25 where workers receive a higher rate of pay.

He added: “We are holding a collective consultation in a small number of stores outside the M25 where colleagues are currently paid a legacy location supplement of 60p per hour on top of their existing rate of £11 per hour.

“This supplement is out of line with the wider retail market and has created an anomaly where some Asda colleagues in stores that are close together are paid different rates.

“As part of this consultation, we are discussing a compensatory payment for colleagues in return for the removal of this location supplement, if the proposal goes ahead. These discussions are ongoing and no final decision has been taken.”