Asda puts 300 jobs at risk and 4,000 face pay cuts

Asda has revealed a shake-up of its store operations, putting almost 300 jobs at risk and reducing pay for more than 4,000 employees.

A total of 211 manager roles will be removed and a further 4,137 will staff lose out on pay premiums of at least £2.52 an hour under new proposals to switch some overnight restocking shifts to daytimes and evenings.

The UK’s third-largest grocery chain also revealed a 22 per cent cut to hours at all 23 in-store Post Office shops. This will affect 23 managers and 200 hourly-paid staff. In addition, it will shut seven of its 254 in-store pharmacies, which would affect 14 full-time staff. 

The supermarket, which was bought by the Issa brothers and private equity firm TDR for £6.8bn in 2020, said the changes would allow it to “operate as efficiently as possible”.

Ken Towle, Asda’s retail director, said: “The retail sector is evolving at pace and it is vital we review changing customer preferences, along with our own ways of working.”

Separately, rival Morrisons posted a 15 per cent fall in core earnings to £828mn in the year to October 30, while total revenue was up 2.2 per cent to £18.4bn.

Group like-for-like sales, excluding fuel, were down 4.2 per cent but they steadily improved over the last two quarters.

“With continued high food inflation, rising interest rates, an ongoing cost of living crisis and the war in Ukraine set to enter its second year, there is a continuing sense of uncertainty in consumer sentiment,” the company warned.

Morrisons, owned by private equity firm Clayton, Dubilier & Rice since 2021, was overtaken last year by German discounter Aldi as the UK’s fourth largest supermarket by market share, according to researcher Kantar. 

Chief executive David Potts said recent efforts to become more competitive on price had started to bear fruit as shoppers increasingly hunt for bargains and swap branded goods for own-label products. It expected a return to earnings growth this year.

Last year the retailer beat petrol station group EG, co-owned by the Issa brothers, to buy the 1,160 shops of convenience store chain McColl’s out of administration. In November, it announced it would close more than 10 per cent of McColl’s stores and convert the rest to its “Morrisons Daily” brand, increasing its market share.

The company said it had incurred “exceptional” losses from the acquisition, including from legal fees, closing stores and debt financing.


Business Asia
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