Investors tell Sainsbury’s to pay the ‘real’ living wage

Investors have urged Sainsbury’s to pay all workers the ‘true’ living wage, saying the supermarket has ‘no excuse’ not to act on wages as the cost of living soars.

The investment NGO ShareAction has brought together a coalition of shareholders to table a resolution at its annual general meeting, which calls on the UK’s second-largest supermarket chain to raise wages further.

It is believed to be the first shareholder resolution asking a publicly traded company to seek accreditation from the Living Wage Foundation. Accredited employers must pay staff at least £9.90, or £11.05 an hour in London.

The coalition includes the UK’s largest asset manager, Legal and General Investment Management; the largest workplace retirement provider, Nest; as well as 108 individual shareholders and Labor MPs Siobhain McDonagh and Helen Hayes.

Martin Buttle, Head of Good Work at ShareAction, said: “Low-paid workers in the supermarket sector are being hit extremely hard by the rising cost of living, but we all owe them so much in the wake of the pandemic. We hope this resolution will catalyze long overdue changes.

“Managers of all supermarkets that are not accredited as Living Wage employers should ask themselves why not and take action to fix things through their workforce before their investors force the issue.”

Managers of all supermarkets that are not accredited as Living Wage employers should ask themselves why not and take action to fix things through their workforce before their investors force the issue. – Martin Buttle, ShareAction

The group is concerned about the impact that rising inflation and weak wage growth will have on the real household income of supermarket workers.

In January, Sainsbury’s announced new pay rates for its directly employed staff, with a basic hourly wage of at least £10 an hour. However, its rate of £10.50 for workers from outside London is considerably lower than the actual living wage in that region.

The group also criticized Sainsbury’s for not making any commitments regarding the remuneration of third-party staff, such as cleaners and security guards. He says excluding third-party staff from pay raises “creates incentives for companies to increase their reliance on outsourcing, reinforcing the growth of precarious work.”

Angeli Benham, senior global ESG head at Legal & General Investment Management, said: “The cost of living crisis does not discriminate between those who live inside or outside London. It does, however, make a distinction between those whose incomes can support the additional financial burden and those with low incomes who cannot. Some working households that previously teetered on the brink of poverty may now be pushed to the brink.

“Sainsbury’s is a household and trusted name that LGIM customers have invested in for decades… We have co-signed this shareholder resolution because we believe that all employees, direct and indirect, who help Sainsbury’s be a sustainable business , renowned and hard-hitting deserve to be paid the real living wage.

The Independent Food Aid Network has reported an increase in the number of supermarket workers using their food banks during the pandemic, while research by Organize found that one in three Sainsbury’s employees regularly worry about put food on the table.

ShareAction has reported that Sainsbury’s can afford to pay the ‘real’ living wage, as it announced expected profits of at least £720million, while its CEO took home £1,319,000 last year.

Siobhain McDonagh, Labor MP for Mitcham and Morden, said: “This will be my second time at Sainsbury’s AGM, continuing to fight for fair pay for all of their loyal and long-serving staff. At the heart of a cost of living crisis, it has never been more important for Sainsbury’s to pay all of its colleagues fairly – and given that they made underlying profits of £720m the last year, they can’t have any excuses.

A Sainsbury’s spokesman said it had received positive feedback from employees since its last pay review announcement and noted it was paying more than some of its competitors.

The spokesperson said: “In recognition of the extraordinary work our 189,000 colleagues do for our customers, this month we increased our base hourly rate of pay for all store colleagues by 5.3%, from £9.50 to our new pay rate of £10 per hour. . This rose from £10.10 to £11.05 for colleagues in central London and from £9.75 to £10.50 in the outskirts of London.

“Sainsbury colleagues’ hourly wages have increased by 25% over the last five years and since Sainsbury’s acquisition of Argos we have increased the wages of Argos colleagues by 39%. Our competitive pay rates are in addition to our co-worker discount program, matching pension plan and recently enhanced family leave policy.

“As we balance the needs of all our stakeholders, particularly in light of the current cost of living challenges many people in the UK are facing, it is essential that we not only pay our colleagues fairly, but that we are able to invest significantly to provide customers with great value.

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Michael A. Bynum