Asda has been accused of short-changing 3,000 supermarket staff under proposed changes to employee contracts that will see the end of paid breaks.
The supermarket confirmed last week that consultations were taking place to simplify terms for hourly paid workers and increase the basic rate of pay to £9 per hour.
But Siobhain McDonagh, MP for Mitcham and Morden, has claimed in a letter to Asda chief executive Roger Burnley that staff involved in the process were likely to be up to £500 worse off per year.
The loss of paid breaks, an end to premium pay and shortening of night shifts would hit staff wages, Ms McDonagh said following a meeting with Asda senior director of public affairs Chris Lowe.
My urgent letter to CEO @asda: downgrading contracts, unpaid breaks and shortened nightshift will see 3,000 staff salaries fall - all under the smokescreen of an 'increase in basic pay'. That's ASDA price... pic.twitter.com/FT7sXa1Vof— Siobhain McDonagh MP (@Siobhain_Mc) April 16, 2019
Approximately 2,700 staff will lose up to £500 per year, with a further 300 harder hit, she claimed in the letter which she tweeted in full on Tuesday.
Ms McDonagh, who has a large Asda in her constituency, wrote: “For these staff, £500+ is a huge amount of money and would have a significant impact on their livelihoods.
“I welcome any increase in basic hourly pay – but this must not be used to disguise a significant pay cut for 3,000 of your most longstanding staff.”
Proposals will also see night shifts reduced to five hours, between 12am and 5am, she also claimed.
The new contracts would increase the basic rate of pay from £8.21 per hour for all retail employees, and would still include the benefits of an annual bonus, colleague discount, sharesave and pension.
However staff will be asked to work more flexible times such as on bank holidays while breaks would no longer be paid.
Ms McDonagh raised concerns over this flexibility and said that while some might welcome the change, others who may have care considerations may find the changes “extremely difficult”.
Responding to the original letter, Mr Burnley said: “As our customers change the way they shop, we need to ensure that we have the flexibility to change with them in order to remain competitive.
“Although 50,000 of our colleagues are already on this contract, in the interests of fairness and to achieve the necessary level of flexibility we need all of our colleagues to be on the same terms.
“In return for this, we propose to increase the take-home pay of over 100,000 colleagues.
“This proposal represents an overall investment of at least £80 million.”
The GMB union, which represents Asda employees, last week raised concerns over the plans to change contracts, calling for negotiations.
Asda said the changes would bring it in line with industry standards.
Anthony Hemmerdinger, Asda’s senior vice president for operations, said: “As our customers continue to change the way they shop with us, we also have to be prepared to change to meet their needs, and a key part of delivering great service is having the right colleagues in the right place at the right time, which is what this contract aims to achieve.”
Asda has entered into a consultation on the proposals, which could see the contracts take effect in late 2019.
It comes after Asda’s prospective merger partner Sainsbury’s made similar changes to its contracts last year, eliminating paid breaks but upping the base level of pay.
The news comes with the Competition and Markets Authority expected to shortly publish Sainsbury’s and Asda’s responses to its provisional findings, ahead of the regulator’s final report, which is set to be published by April 30.