John Lewis considering cutting 11,000 jobs after slashing redundancy terms | John Lewis

The proprietor of John Lewis and Waitrose is considering cutting as much as 11,000 employees jobs within the subsequent 5 years, after the retail group slashed redundancy terms this week.

Sources stated not less than 10% of the staff-owned enterprise’s 76,000-strong workforce might go throughout the group’s head workplace, supermarkets and department shops.

Department heads are engaged on plans and the variety of roles within the enterprise is anticipated to be step by step diminished over a number of years through redundancies and never changing employees who depart, sources stated.

John Lewis warned about potential job cuts in March final yr as a part of a plan to cut back prices and use know-how to enhance effectivity. The group has already reduce hundreds of jobs partly by retailer closures, together with 16 department shops and a number of other supermarkets, over the previous few years.

One well-placed supply stated John Lewis executives had mentioned cutting as many as 11,000 roles as a part of its newest turnaround plan – amid rising pay and different prices and poor gross sales. Another stated this determine had been briefed to pick out employees by some managers as the corporate battles to bounce again from a £230m full-year loss.

The scale of potential job cuts emerged after the John Lewis Partnership (JLP), which is owned by its employees through a belief, wrote to staff this week telling them it was cutting the terms of its redundancy bundle in half – providing one week of pay a yr of service as an alternative of two for anybody being made redundant from 1 February.

One member of employees, often known as companions due to they co-own the enterprise, stated the announcement of a reduce was significantly galling because it got here shortly after quite a few senior executives had left on the extra beneficiant deal.

JLP instructed employees it was making the change as the present bundle was “higher than typical market practice and comes at a very high cost”. It stated it wanted to “free up cash” with a “more affordable” coverage.

The firm presents the “partnership redundancy pay” bundle on prime of statutory redundancy pay which is about by the federal government at one week a yr of service for over 22s and 1.5 weeks for these over 41, capped at a most of simply over £19,000.

In an inner memo issued on Thursday, first reported by the Telegraph, the John Lewis Partnership stated: “Against all of our competing priorities for investment, it’s fair to say that the high cost of redundancy pay has been one of the things that’s prevented us from moving as quickly as we’ve wanted to transform ourselves for the future, and has restricted our ability to invest more in pay.”

It added that it was elevating the minimal redundancy fee for individuals who didn’t qualify for the total partnership bundle from one week’s pay to 4 weeks to “better support those with shorter service who are affected by redundancy”.

The announcement prompted a flurry of livid posts on the group’s inner messaging board with one employee saying: “Another example of major changes being made which will affect partners without a dialogue with partners.”

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Some known as for an emergency assembly of the group’s partnership council, which supplies the owner-workers a democratic voice through elected representatives from throughout the enterprise.

One member of employees instructed the Guardian: “We are held up as a better way of doing business and this just sits uncomfortably particularly when you take into account the recent wave of leadership level [redundancies].”

A spokesperson for JLP stated: “What we are doing is cost-neutral and it is a rebalancing because any saving on redundancy pay will be directly reinvested into partner pay.”

The information on cutting redundancy terms was despatched out through an e-mail after which posted on the corporate intranet with employees not knowledgeable of any dialogue on the partnership council.

JLP stated the difficulty had been put to the council and the group’s democratic processes had been adopted however the assembly had not been livestreamed to employees.

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