John Lewis may suspend staff bonus as retail slump bites

Weak consumer demand prompts department store chain to consider scrapping bonus for first time since 1953

John Lewis may suspend its staff bonus this year in the wake of the worst Christmas for retailers since the depths of the financial crisis.

The employee-owned John Lewis Partnership which also owns Waitrose said its board would “need to consider carefully … whether payment of a bonus is prudent in the light of business and economic prospects at that time”.

Its chairman, Sir Charlie Mayfield, warned that partnership profits will be substantially lower this year despite higher sales at Christmas, due to heavy discounting by rivals and weak consumer demand.

John Lewis slashed its staff bonus last year to just 5% of salary which was the lowest level of payout since the 1950s. The bonus was first paid in 1920 and is handed to all staff, from shelf stackers to senior management. The last time John Lewis suspended the payment was during the economic downturn of 1953.

The warning came amid a slew of downbeat trading updates from some of the best-known names in the retail sector on what had been billed as “Super Thursday”.

Marks & Spencer and Debenhams reported a slump in sales over the crucial trading period and Halfords fired off a profit warning which it blamed on the “mild weather and weak consumer confidence” that wiped a quarter off the company’s value.

Original Source



Add comment

Your Header Sidebar area is currently empty. Hurry up and add some widgets.