As 2023 draws to a close, we look back at Grocery Gazette’s best bits. Today, we explore why Asda’s pay increase in February caused a backlash with staff.
In February, Asda invested £141m in giving a 10% pay increase to all its hourly-paid store colleagues, taking it from the bottom of the supermarket pay league to sitting comfortably at the top.
The pay rise – which comes into effect in April and will take the hourly rate to £11.11ph by July – will be the third Asda had given its staff within the past 12 months. It takes the supermarket straight to the top of the table, where it will be the second-highest paying grocer as of July.
Great news, right? Well, not necessarily. It wasn’t long before Asda employees revealed that as part of the new wage structure they had lost their annual bonus – something they were largely unhappy about.
Over the past year, Asda had been branded the “worst paying” supermarket by GMB Union, criticised for failing to raise pay for workers in line with other ‘Big 4’ retailers and faced long-standing disputes with its staff over low pay rates.
While it seemed that had all changed with the latest pay increase, Grocery Gazette has since been informed by a number of independent sources that the new pay structure – which includes removing the popular annual bonus – has not been accurately portrayed by the UK’s third largest grocer.
So what is really happening and where did Asda go wrong?
Changes to Asda’s bonus structure
In February, Asda announced that pay rates would be rising to £11 per hour from April and £11.11 per hour from July, in a move which will benefit more than 115,000 colleagues working across its 633 stores.
However, despite being lauded as the UK’s best paying supermarket (until Aldi upped its own rates) – employees have said there is more to the story, claiming that while a pay rise is appreciated, there are other key elements of Asda’s new pay structure that haven’t been revealed.
Asda’s bonus scheme had previously been based on an individual store’s achievement – with high performing staff earning a 100% bonus. However, this is now based on corporate achievements and will be removed completely from April.
An anonymous source told Grocery Gazette: “You can have a top performing store that used to get a 100% bonus to this year getting just over 25%. It’s not a lot as it equates to about £100 before stoppages, so about £60 in total.”
GMB Union, which campaigns over pay and working conditions for members, including Asda employees, says that exact bonus figure this year was awarded at 25.8%, based on the company’s performance.
National officer Nadine Houghton says that the previous structure was awarded on individual targets and gave colleagues “an incentive to succeed”.
“We are in the position now that colleagues in good performing stores feel they have been unfairly treated in this year’s bonus award.”
A spokesperson for Asda told Grocery Gazette that “bonus payments for hourly paid colleagues were linked to the number of hours worked”. They explained that this structure was initially changed because the business as a whole was unable to hit its targets, potentially no colleagues would have seen a yearly bonus.
Losing the bonus entirely
While the bonus had only recently been restructured, our source revealed that 2023 will now be the last year that any store workers will receive any sort of bonus.
“This is the last year that hourly paid retail staff will receive any bonus as part of the pay deal, bearing in mind it was halved last year to pay for that pay rise as well,” they said.
“Although the pay increase was on the outside a generous one, in real terms not so.”
Another source added: “It’s only hourly paid staff that are losing the bonus, salaried staff get to keep their bonus but it’s the hourly staff that put in the hard work.
“I have only been with company 18 months and can say in that short space of time so much has changed, and not for the better. I only remain with Asda because I need to work, both for a comfortable life and my sanity.”
Houghton said that while the 10% pay rise “was well received during a cost-of-living crisis,” this was “diluted by Asda trying to offset the cost of implementing the pay rise by making several cost cutting saving across stores.”
She adds that it did this by “significantly slashing the contract base in all stores, which has had the effect of reducing colleague numbers quite drastically.”
“They have removed the colleague bonus, entered consultation to eliminate the 60p middle rate in 39 stores, and are also proposing to move the night replenishment team to a twilight operation, saving a night premium rate of £2.54 p/h in 166 stores.”
In response, the Asda spokesperson said that the retailer had received “feedback from colleagues in the past that they would prefer bonus potential being part of base rate pay”.
“The new, increased rate and the end of the bonus was communicated to all colleagues in-store. All bonus payments are discretionary and based on an eligibility criteria, whereas this increase is a guaranteed payment.”
Asda is currently one of the only supermarkets to offer a bonus to its hourly-paid colleagues, as in January, Tesco shopfloor staff said they didn’t receive a cash bonus or voucher at Christmas for the second year running and earlier this month, Waitrose staff were informed that they would not be receiving a bonus this year.
What now for Asda’s hourly-paid workers?
When Asda was branded the “worst paying” supermarket by GMB Union and criticised for failing to raise pay for workers in line with other supermarkets, it responded with the promise that it would announce new pay rates in the first quarter of 2023.
The supermarket kept its word – but in the meantime others had also boosted their pay even further, with Sainsbury’s taking its hourly wage to £11 and Tesco boosting rates of pay to £11.02 per hour.
Asda’s new pay rates may have made it the second highest paying supermarket behind Aldi, but there’s clearly still much to be done in terms of employee relations.
Bonuses give employees more than simply a financial boost – although of course that’s nice as well. It gives employees control over their remuneration, allows them to enjoy a ‘bulk’ payment and can improve productivity.
Even when it’s being given back as a salary increase, removing an annual bonus ranks pretty low in terms of motivational tools. Will Asda listen to their staff this time?
39 Comments. Leave new
I’ve worked for Asda for 15 years. I can honestly say since the buy out it’s gone drastically down hill. They just don’t care about the staff many have left the GSM in our store is a bully.
The bonus was absolutely shocking. Some managers in the store I work in told us that it would be 25% of our monthly wage and not our weekly wage. My bonus was £82 but ended up at £50 after tax and national insurance
My 1st bonus, 16 years ago was £75. Everyone complained it was the worst bonus they ever had! My bonus 16 years later, £68. I have no words!
I was told the same 25% of the month. Was begged to do 6 nights aweek this month. And got a slap in the face bounus
I’ve worked for Asda for over 25 years and since Walmart & now the ISSA brothers have so called owned it they both have ruined what was once a colleague / customer orientated business. Without the colleagues hard work there would be no business to keep taking profits out & not giving anything back to the actual people that matter. We have to put up with a lot everyday from the public as they get really frustrated when there are not enough tills open, no stock on shelves due to less colleagues, not enough trollies/ baskets, the list goes on, all because greed is being put above anything else. Without colleague they would have no business & that’s a fact.
25 years service GSMs bully everyone, everyone is replaceable, everything is done at the lowest cost , regional managers either don’t know or just ignore people policy, no team morale as no colleagues , ultimately no one cares , they just tell you to leave .
Spot on,I couldn’t of said it better 👍
Will Asda listen to their staff this time?
I’ve been with them for over a decade, they haven’t listened before, and I am under no illusions that they will listen now. I go to work, do my job and come home. If they want extra from me, they can jog on.
Weve also lost the sharesave scheme; “Asda rewards” site, that offered 3rd party discounts like cinema tickets and cashback rewards; delivery drivers (the job role with the highest colleague turnover) have had their £1.50 supplement or a monthly “star points” reward (£10 per month plus a bonus £15 extra on a 3rd consecutive month) for achieving an excellent driving style rating removed. Now there’s a 3rd party driver lottery (operated through “Lightfoot”) where you are lucky if you get £1 in a year.
There’s also going to be the closure of in-store pharmacy’s and postoffices in some stores. They already have closed in-store bakeries as well as meat and fish counters.
National minimum wage is also to rise, no where near the cost of inflation, morale is at an all time low, colleagues pressured into doing extra work or taking on other roles due to staff shortages, not enough equipment all the hard work through COVID pandemic has sharp been forgotten. Definitely makes this “pay rise” seem very insignificant!
I worked for ASDA for 19 years,I loved my job.but the stress was too much.no staff,just get on with it.asda was a great company to work for 19 years ago . working for a supermarket should not be stressful,but that happens.
I work in an Asda store. I done 4 years and left because of understaffed departments, unappreciated staff taking up the slack leading to people over worked and frustrated. After being away for a year I returned on a temporary maternity cover. Nothing has changed, staff are still trying to keep their department running without enough staff, no appreciation from management. And as for the bonus they gave me £17.00 😂😂😂
Removing the 60pph cost of living allowance will be a £1000 pa cut in taxable pay.. not an insignificant redution… Home delivery drivers have also lost the opportunity (2yrs ago) to earn an extra £220 per yr for safe and efficient driving
Not heard anyone complain at the Asda I work at, the bonus at our place was generally chiselled away to peanuts anyway which was a more common complaint, It’s now just an asset stripped, debt dumped shell of a company in need of new owners.
It was put into their pay at 60% of their bonus so they get 60% every year so this year they get 60% plus 25.8% and when it’s gone they will still get 60% every year as it was built into the pay deal so isn’t a guarantee of 60% better than a maybe 25 or 30%
.
Yeah it will be the equivalent of 60% this year, next year we’ll be back to minimum wage and no bonus. It’s what Asda do, they are deceitful. The same happened with the forced contract changes a few years ago!
Why does nobody talk about Morrisons pathetic pay offers? Plenty of real terms pay cuts over the years.
We work hard all year do our best n then they shit on us all. Bank Holidays taken now bonus
Scandalous that hourly paid colleagues no longer recieve a bonus but salaried (management) still do. The colleagues on the shop floor have to deal with awful customers, getting abuse thrown at them and sometimes it gets physical. They are the backbone of the company, where management hide in offices or, occasionally, become the highest paid shelf stackers in store.
It was quiet cheeky how the new owners and the company did away with the bonus, most of us had already said we’d prefer a decent rise than the bonus because in a way the bonus was unfair especially if you ended up being of sick or had any disciplinary against you.. The stupidest bit about the rise is waiting 3 month to get an extra 11p which is obviously some sort of incentive to exploit seasonal workers
Absolutely disgraceful that management will still get there hefty bonuses and the colleagues sidelined again for keeping the stores stocked, It’s the Colleagues who welcome the Customers in to the store talk to them make friends with them Take the abuse from them for something of not there doing. With out the Colleagues to front these stores there would not be any Supermarkets Please treat these Colleagues fairly
Not to mention the cutting of the night premium, and certain stores get a location allowance of 0.60p per hour which is soon to be cut! Which actually pays my travel each day, effectively from Nov I think it is, we will be down 0.74p per hour, not even including the annual bonus which is now obsolete for hourly paid colleagues at least!
Tesco did the same, got rid of colleague bonus supposedly put on hourly wage, then thiscyear gave a good rise but then took 8% off sunday premium for existing colleagus, so any one who is contracted for sundays gets a pay cut with no compensation for it.
Customers don’t pay extra for their shopping on a Sunday, why should you be paid more for working on a Sunday.
Bet you don’t work sundays
Wow, you still got paid extra for Sunday. Asda took that off us about 20 years ago!
Asda is not the place it used to be, its now become cut-throat and greedy with no duty of care for staff. Because night staff jobs are going daytime staff are now expected to work the night deliveries as well as the daytime jobs, while managers are expecting good bonuses from our hard work, staff are leaving in droves or going off sick, so i woudnt recommend anyone to work at asda.
My bonus was £39 before tax this year. Anyone have an address for the Issa brothers so I can send it back? Seems like they’re struggling for cash more than us colleagues.
Apparently we only get a 25.8% bonus due to poor performance of the stores. They do know we can see sales are up year on year?
They only made a profit of £889 million this year. It was enough to buy them both their own private planes, paid for by the bonus they’ve taken off the colleague’s.
Over the years as a night colleague I’ve stopped many potential dangerous situations and risked my own health and safety with thieves trying to get out of the store with our stock, now with our bonus out of the window I will now turn a blind eye and turn the other way, let the managers deal with it and in my experience they hid and didn’t get involved BUT got the glory for it
Minimum pay = Minimum effort, that’s my philosophy now. The forced contact change was just an awful thing to do! Night premium only paid between 12 and 5am is a joke! I do what I can, then clock out at exactly 6am, leaving whatever delivery isn’t worked and really don’t give a damn!
What will be happening to at the pharmacies ASDA is closing?
What will be happening to at the pharmacies ASDA is closing?
Work for Asda thay mes your pay don’t pay bounes when it duefor pay and under pay u thay bunch of tea leaf I’m struggling live im off sick thay treat staff like scum
We are constantly taken advantage of at asda
Never known a company that couldn’t care less about there staff as much as Asda don’t. Staff are treated like rubbish by some members of management the way your spoken to is horrendous.
I have worked for Asda for 20 yrs . First they stopped our share save , the Bonus. And yet the staff that work for IPL. Also owned by the company got a £50 asda gift card and monthly incentive payments. I have been told this by the people who work for them . IPL and the GE group staff also get discount in store. Most of Asdas staff are trying to do 2/3 jobs at the same time. We are so short staffed.
I worked for asda for 22 years when I started it was family and customer you has your share saves and bonus discount days family and friends discount paid breaks and slowly they have taken everything of you there is no benefit to working for asda anymore the wage does not reflect the work I worked my back side off and and for a really low wage I have now left and work for a better paid job
Try working for their garages, now owned by Asda, though salaries a lot lower than Asda Colleages and 50 p extra per hour for night shift. single rate for Christmas Day.
Issa brothers shame on you ! Our Asda staff are so understaffed each person doing the job of four ! one warehouse lad all thru Xmas on his own ! I hope you get you’re karma for grinding staff to exhaustion point if we wanted boxing day off had to be booked as a holiday ! Greedy that’s what you are hope that all the staff start striking and you realise what you are doing to hard working people ! Shame on you!