Asda to increase basic pay as contract dispute goes to the wire

The supermarket giant said it would increase the basic hourly rate for its hourly-paid staff to £9.18 from April 1, 2020, with staff working in London seeing basic pay increase to £10.31 an hour for additional cost of living allowance.

The contract at the heart of its ongoing dispute with staff was already set to increase basic hourly pay to £9 an hour from November 3 this year.

The retailer said this means staff would receive a second increase in hourly pay rates within 12 months, with some staff getting a base rate pay uptick of more than 11%.

Asda said that “existing additional benefits, including the company’s annual bonus scheme – for which all colleagues with more than three months’ service are eligible – pension, sharesave and colleague discount schemes, will remain in place”.

It also noted that additional role premiums, such as for night workers and section leaders, would “also remain unchanged”.

Senior vice president of people at Asda, Hayley Tatum, said: “I’m pleased that we’re able to confirm a further increase in the basic rate of pay for our retail colleagues, which will be introduced next year, and give certainty to our colleagues despite an unpredictable economic landscape and challenging market.”

However, GMB, the union for Asda workers, has called the pay rise “a smokescreen to distract from the fact that they plan to sack workers”, and that the announcement was evidence it was “feeling the heat from opposition to the contract changes”.

The supermarket giant has been locked in a running battle with staff and the GMB union since early April, when it put 3,000 hourly paid staff into consultation over proposed contract changes.

The union claimed earlier this week that as many as 12,000 Asda employees are in danger of losing their jobs if they do not sign the new contracts, although Asda insists the number of jobs at risk is significantly lower.

GMB national officer, Gary Carter said:  “Asda are using this 18p rise as a smokescreen to distract from the fact they plan to sack workers this weekend unless they sign a punishing new contract. It is unprecedented to announce an April pay rise in October – and Asda are clearly feeling the heat of opposition to the imposition of this contract.

“We do not yet know what inflation will be by that point, and so this could end up failing to keep pace with the cost of living.”