Close to 1,000 of Tesco’s Irish employees are to be hit with significant pay cuts if the retailer succeeds in moving some of its longest-serving staff to different contracts.
Tesco Ireland yesterday confirmed it was seeking to cut pay and conditions for about 6% of its 14,500 employees.
The company met staff on Tuesday and informed them of its plan to move hundreds of workers on contracts signed prior to 1996 onto ‘modern’ contracts agreed with unions in 2006.
Mandate, the trade union representing the majority of affected workers, claimed the cuts could cost workers about €6,500 a year but added they would be strongly opposed by staff.
“Tesco’s antics yesterday led to shock for all of the staff concerned but that shock has quickly turned to anger and now determination as the workers say they will resist any changes that are pushed through without negotiations and ultimately agreed with the workers concerned.
“The mischievous attempt to attribute these cuts to ‘customer services’ has gained no traction with anyone.
"This is quite simply a case of Tesco attempting to increase their profits for the parent company at the expense of their long-standing members of staff,” said Mandate assistant general secretary Gerry Light.
The trade union claims affected employees would see a cut of 16.5%, or a minimum of €6,591, in their annual income.
Workers on pre-1996 contracts are also guaranteed overtime whereas those on the modern contracts are not.
A Tesco spokesperson said it is seeking the changes in light of an evolving retail landscape, saying the company hoped the move would increase the flexibility of its workforce.
“Our pre-1996 contract doesn’t meet the needs of today’s customers and was agreed 20 years ago at a time when stores didn’t open Sundays or late nights.
“As a result we have too many colleagues rostered during our quietest days instead of our busiest; and guaranteed overtime which doesn’t take account of the needs of each store or give colleagues an equal opportunity to work overtime when it arises.
“To unlock this inflexibility in our business so that we can reinvest our resources in having more colleagues on the shop floor at our busiest times, we propose to move all pre-1996 colleagues onto our modern contract which was agreed in 2006 with the Trade Unions as part of our collective agreement,” the spokesperson said.
The retailer said it would compensate workers for loss of earnings and would work out the extent of this compensation in discussions with staff and unions in the coming weeks.
It aims to implement the changes by mid-April. Staff would earn €11.97 per hour on the 2006 contracts.
Those at the upper end of the pay scale earn €14.31.
The majority of those on pre-1996 contracts would be at this upper end given the length of their tenure with the company, says Mandate.
The news came after Tesco was found on Tuesday to have seriously breached the UK’s groceries supply code of conduct by short-changing its suppliers to protect its own finances.
The findings of Britain’s Groceries Code adjudicator which highlighted Tesco’s “endemic culture” of making deductions from suppliers’ bills and delaying payments prompted Food and Drink Industry Ireland to call for the urgent publication of Irish grocery regulations.
Tesco reported annual losses of £6.4bn (€8.38bn) in April last year.
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