Tesco proves that every little helps

Once again, the UK’s food retailers are leading the way on progressive HR
practice. Tesco’s trial scheme (page 1) to cut pay from workers taking a day
off sick isn’t startlingly innovative, but the way it has been handled by the
supermarket giant certainly is.

Tesco is in bullish mood having swiped market share from its rivals,
announced a workforce expansion creating 20,000 jobs and notching up a profit
increase of 17.6 per cent. The board is sharing out £11m as a reward for its
efforts last year, and 160,000 staff will receive incentives and bonuses worth

When you’re riding on the crest of a wave as big as this, you can afford to
be up front about cost-cutting initiatives, which, on the face of things, could
actually be highly damaging to your public image and employer brand. But Tesco
has handled all the attention with aplomb.

And it’s about time business was widely seen to be getting to grips with
real and fake sick leave. While the bigger problem is long-term absence, Tesco
is nevertheless having a shot at discouraging unplanned last-minute sickies,
which can wreak havoc on the customer experience.

There is an obvious gap between the sicknote and the ‘sniffle’, but it seems
many UK employees don’t know where it lies. Research by Adecco, the recruitment
consultancy, showed that only 18 per cent of the people it surveyed had any
clear picture of their employer’s short-term illness policy. More transparency
and wider communication on absence management policies and practice would be a
good thing.

Tesco is the UK’s largest private sector employer with more than 221,000
staff, although it hasn’t compelled any of them to take part in its pilot. But
the hope is voluntary measures such as this could cut absence costs by as much
as a quarter. The unions are wisely supporting such action, no doubt thinking
that they should learn from the experience.

Tesco has struck gold in all its core areas and the people strategy has been
critical to its success in winning loyalty from 12 million customers every
week. As befits a market leader, it is also a company that has been generous in
sharing its knowledge – warts and all – across industry.

Tesco deserves the admiration it gets – no wonder it’s become one of those
businesses many want to emulate.

By Jane King, editor

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