20 Colleagues 2 - Ben

Commitment and engagement

National Living Wage

We know what a difference our colleagues make to our customers every day, and we’re committed to rewarding them.

The challenge

The new National Living Wage has dominated headlines since it was announced in the Government’s Budget last July. From April 2016, businesses must pay at least £7.20 per hour to workers over the age of 25, rising to £9 by 2020.

What we’re doing

We know what a difference our colleagues make to our customers every day and we're committed to rewarding them; so we’re using the public discussion about the new living wage to listen and gather the opinions of our colleagues around rewards, contracts, pay and benefits.

We have always paid well above the National Minimum Wage and in August we gave 137,000 colleagues working in stores across the country a four per cent pay rise. This took our standard rate of pay from £7.08 to £7.36 an hour; well above the Government’s new National Living Wage.

While the new National Living Wage secures a minimum pay of £7.20 per hour only for people over 25, we do not differentiate on age. Our 43,000 under-25 colleagues are really important to us, so our pay rise applies to them as well.

This isn’t something new for us; our colleagues are among the best rewarded in the industry. We are one of the few retailers to pay colleagues for the breaks they take during their shifts.  Other benefits highly valued by colleagues include a pension, life insurance, a discount card and an annual bonus. Earlier this year we awarded colleagues a bonus pot of £50m and also awarded a three per cent pay rise last year.

What's next?

We are consistently rated best for service and availability in our stores and it is essential that our colleagues who deliver this remain valued and motivated; so we will continue to listen them to understand what they value most about our rewards packages.

We gather feedback from numerous sources such as our Talkback colleague survey, listening groups and letters sent to our Chief Executive, Mike Coupe, as well as from his store tours.

We are committed to continuing the progression of our wage rates and are now looking at a number of options to support this over the next five years.