Employment

Sainsbury’s bosses have rejected a call to become a real living wage employer

Sainsbury's does pay its in-house staff the "real living wage" but shareholders blocked a request to extend it to all third-party contractors.

Sainsbury's supermarket

Image: David Howard/. Flickr

Shareholders of Sainsbury’s have voted against the supermarket becoming a real living wage employer.

Just 17 per cent of investors voted to commit to paying all workers the “real living wage” in the face of rising cost of living and inflation.

The real living wage is independently calculated by the Living Wage Foundation every year, and is described as the amount needed to live adequately in Britain. 

Currently, it stands at £11.05 an hour in London and £9.90 for the rest of the UK. This is higher than the government set national minimum wage, and national living wage for people aged 23 and above.

Sainsbury’s chair Martin Scicluna argued that committing the business to paying every employee at least the living wage would reduce the company’s flexibility. 

Sainsbury’s CEO Simon Roberts was paid £3.8million last year.

While Sainsbury’s was the first supermarket to pay all of its in-house staff the real living wage, investors refused to extend this to third party contractors such as cleaners or security staff, meaning it can’t be classed as a living wage employer.

Becoming an accredited living wage employer would also commit the supermarket to increasing its rate of pay each year’s new calculation of the real living wage. 

“We are the leader in the supermarket world in paying the living wage right now. We’ve got an amazing track record of being a responsible business. And there are other retailers who frankly have not demonstrated that they’re responsible,” Scicluna told ShareAction, which campaigns for responsible investment and tabled the motion at the Sainsbury’s AGM.

“We believe we have behaved very, very responsibly, the only difference … is that we don’t want to go the full length of being accredited,” he continued. 

ShareAction’s Rachel Hargreaves said while the motion received significant shareholder support, “a large proportion of shareholders chose to prioritise short-term returns over the real long-term issue: rising inequality in our society.”

She added: “As we deal with the continued effects of the cost-of-living crisis, the conversation around low pay isn’t going to go away, and both employers and investors need to step up.”

In response to soaring inflation, The Living Wage Foundation has announced it will be bringing its 2022-23 rate forward by two months to September, in response to the rising cost of living.

Katherine Chapman, director  of the Living Wage Foundation said: “Although the wait for a living wage accredited supermarket continues, Sainsbury’s deserves credit for increasing the pay to all directly employed staff to at least the real living wage.”

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