Some employees at Tesco are unhappy about the postponed pay raise, which violates the minimum wage requirement and benefits the company with over £17m in savings.
One of UK’s major employers, Tesco, has promised to raise the minimum wage for its store employees from £11.02 to £12.02 per hour next month. However, this update will not take effect until 28 April, which is almost a month after the legal minimum wage of £11.44 per hour for individuals 21 and over becomes effective on 1 April.
“We are all deeply outraged, especially since our union gave their approval,” one staff member informed the Guardian.
According to HMRC regulations, there is a designated time period known as the “pay reference period” that starts on or after April 1st. For Tesco, this period begins on April 28th, and during this time, minimum pay rates can be enforced.
Rephrased: “Tesco has saved around £17 million by implementing a pay rise at the end of April, despite 220,000 workers missing out on an increase of £1 per hour that was promised. This savings amounts to 42p per hour per employee, which adds up to over £7 million for the duration in question, compared to if they had paid the new minimum wage for workers 21 and over.”
According to Daniel Adams, the national representative of the Usdaw union, the recently negotiated pay agreement has been approved. Adams also stated that although it would have been ideal for the company to have implemented the raise sooner as originally requested by Usdaw, the regulations do permit them to make that decision.
“Usdaw has negotiated a significant pay rise that makes Tesco workers amongst the highest paid in the sector. While the union will always seek implementation on the pay anniversary date, which was 2 April last year, the outcome of these negotiations meant that the date was delayed until later in April to allow for the highest investment in pay possible.”
The labor union announced a 9% increase in salary for next month, which would have a positive impact on 220,000 individuals. This marks one of the biggest pay investments made by Tesco in a year, as the company faces stiff competition in hiring employees.
Asda has recently decided to raise its minimum hourly wage to £12.04, similar to Sainsbury’s, Aldi, and Lidl who have also increased their pay to £12 an hour.
A representative from Tesco stated: “We are putting in more than £300m towards increasing colleague wages, raising our hourly rate to £12.02. This amount exceeds the national living wage and has been approved by Usdaw.”
Our updated rate will begin in the April pay cycle following the HMRC guidelines, and we adhere to all NLW regulations. We take pride in consistently investing in our colleagues’ pay, with a 26% increase in hourly wages since 2022, totaling over £750m.
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The business also announced improvements to additional perks, such as extending paternity leave to a duration of six weeks and increasing our colleague discount allowance to £2,000 annually.
In January, the supermarket increased its projected profits for the year by £50 million to £2.75 billion, citing a better-than-expected trading performance during the holiday season. This followed after the initial announcement of their expectations.
He attributed the achievements in part to the increase in co-workers on the sales floor, contributing to the delivery of outstanding market availability.
Source: theguardian.com
