Asda is looking to cut the wages of 7,000 staff in the south east of England.
The retail giant is targeting 39 stores outside the M25 where its workers have historically been paid extra to offset the higher cost of living closer to London. It said that was looking to remove anomalies whereby workers in stores in close proximity were being paid different rates.
The GMB union claimed Asda was likely to fire workers who did not accept the new conditions, adding that the workers were already low-paid, and that planning to reduce pay during a cost-of-living crisis was “inexcusable”.
A spokesperson for the company said all Asda staff had recently been given a 10% pay rise to help with rising inflation.
The workers in the south-east receive a “location supplement” of 60p per hour, which Asda was looking at scrapping, and a night supplement that it wanted to reduce, the GMB said.
The union added that those who do not agree to the pay reduction “could be dismissed if they refuse to sign” the new contract.
A consultation on the new wage structure has been under way since February, according to the union, with Asda planning to bring in the changes in November.
An Asda spokesperson said the collective consultation was only taking place “in a small number of stores” where workers were paid 60p per hour on top of the £11 per hour national rate.
Asda said it was discussing a “compensatory payment” in return for removing the location supplement.
A spokesperson told Personnel Today: “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. 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.”
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Asda has about 140,000 employees across about 630 stores, and since 2021 has been owned by Mohsin Issa, Zuber Issa and TDR Capital. Walmart, its former owner, retains “an equity investment” in Asda, a seat on the board and “an ongoing commercial relationship”.
