Logistics giant criticised for furlough use while paying CEO bonus

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XPO Logistics, which carries out transport and logistics for companies including Morrisons and Waitrose, has come under fire for paying its CEO a multi-million dollar bonus while claiming millions in furlough grants.

Some $6.4m (£4.6m) in bonuses were paid out by the US transportation giant in 2020, including $3.3m to its CEO Bradley Jacobs. Yet, according to the Unite union, the company has refused to top-up the wages of UK employees who have been furloughed.

According to government data, the company received at least £500,000, at least £1m, and at least £1m in grants under the government’s Coronavirus Job Retention Scheme in December 2020, January 2021 and February 2021 respectively.

Unite and the GMB union have been lobbying for the company’s 25,000 UK employees to receive some form of pandemic-related bonus in recognition of the health risks that have come with their frontline roles over the past year. However, no such payment from XPO has been forthcoming.

Last year, XPO Logistics posted a global revenue of $16.5bn. On top of his bonus, Jacobs also received a long-term cash award of up to $80m in July 2020.

“The bonuses given to the chief executive are a complete kick in the teeth for the XPO workers who have risked their health to keep the company operating throughout the pandemic,” said Unite national officer Matt Draper.

“There is clearly one rule for the bosses and another for the workers on the frontline who have been denied any kind of bonus. What makes this even more sickening is that UK taxpayers’ money appears to have gone straight into the pockets of the company’s American chief executive.”

GMB national officer Mick Rix said: “XPO spend on executive pay is nothing short of greed – especially when you contrast how slow XPO was to enact UK government guidance for employers on social distancing and other requirements at the start of the pandemic.

“At one stage, XPO encouraged workers to share freezer suits at its Morrisons supermarket site in Scotland – until GMB stepped in.

“It’s time the XPO workforce was treated with respect and given a share in the vast company profits that they help contribute to.”

An XPO Logistics spokesperson said: “The pandemic presented our business with unprecedented challenges, but through it all, our priority has been, and always is, the health and safety of our colleagues and customers. We all have made huge efforts to keep our operations running for our customers to ensure essential food, medical devices and e-commerce operations delivered throughout the crisis and lockdowns.

“As intended, the furlough scheme has helped us secure the jobs of our employees whose tasks were reduced or stopped due to how the lockdowns have affected the hospitality and retail sectors in particular.”

During the first peak of Covid-19 last year, warehouses run by XPO Logistics were criticised for not observing social distancing guidance. In March 2020 the XPO-run Asos warehouse in Barnsley was described as “a cradle of disease” by the GMB union.

The furlough scheme is set to run until 30 September 2021. Furloughed employees will continue to receive 80% of their salary for hours not worked, but employers will need to contribute 10% from July and 20% in August and September towards the hours their staff do not work.

The number of organisations making claims through the furlough scheme dropped by 12,000 in February.

Many organisations have voluntarily paid back cash claimed through the scheme after seeing strong business performance. Today, Hotel Chocolat said it would repay £3.1 million it received from the government in furlough money after seeing a surge in sales over Easter and Mother’s Day.

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