John Lewis considers axing staff bonus over financial uncertainty
today Jan 11, 2019
Some 83,000 John Lewis staff may not receive a bonus this year, as the UK department store group has warned it will review the payout amid falling profits.
Staff at the 350 Waitrose and 51 John Lewis stores have received a share of the company’s profits every year since 1953.
But while John Lewis Partnership bucked the downward trend over Christmas, it said its 1.4% increase in sales for the seven-week ended January 5 may not be enough to secure a bonus for its staff.
The retailer has said the challenges facing physical retailers are a result of an “oversupply of physical space and relatively weak consumer demand”.
It expects its full-year profits to be “substantially lower” due to slower sales growth and a squeeze on its margins.
In a statement released this week, it said it has the financial strength to pay a “modest” bonus this year, however chairman Sir Charlie Mayfield warned that the payout might not be the most sensible idea given the high street crisis.
“The board will need to consider carefully in March, following the usual process, whether payment of a bonus is prudent in the light of business and economic prospects at that time,” he said.
The company’s Fashion category performed particularly well during the seven-week Christmas period, up by 6.8% with own-brand womenswear enjoying a 14.7% boost.
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