Sainsbury’s under new pressure to pay living wage for all workers

June 27, 2022

Sainsbury’s under new pressure to pay living wage for all workers

The Queen’s bank, Coutts & Co, and the Coal Pensions Board have joined a group of investors backing a resolution calling for Sainsbury’s to pay the independently set living wage for all staff and contracted workers.

The vote at the UK’s second-largest supermarket’s annual shareholder meeting on 7 July will be the first on a resolution committing a UK company board to pay the living wage.

ShareAction, the responsible investment campaign group, said the resolution would be a “litmus test for investors’ social commitments amid the cost-of-living crisis”.

Leading City investors including HSBC, Legal & General Investment Management and Fidelity International as well as retirement fund Nest and the Brunel Pension Partnership are already part of the coalition behind the resolution that comes as family budgets are squeezed by surging inflation.

Sainsbury’s has raised pay for its 171,000 direct employees across more than 1,400 stores in the UK to the living wage, which is independently calculated for the Living Wage Foundation charity, of at least £9.90 an hour outside London or £11.05 in the capital. However, it has not made the same commitment to contractors. Outsourcing companies such as Mitie provide essential services such as cleaning and security to the supermarket.

An employee stocks a shelf at a Sainsbury's Local store in central London
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Leslie Gent, the head of responsible investing at Coutts & Co, said: “We recognise the positive progress made by Sainsbury’s to match the living wage for its directly employed staff. As a living wage employer ourselves we believe that this accreditation would set a standard for all UK supermarkets, and would provide the certainty and transparency that helps attract a high-quality workforce, today and in the future.”

More than half of the FTSE 100 are among the more than 10,000 accredited living wage employers. However, none of the big supermarkets are among them.

The government’s national living wage, which sets legal minimum rates, pays £9.50 to those aged 23 and over, dropping to £6.83 for those aged between 18 and 20, and £4.81 for apprentices.

Rachel Hargreaves, a campaigns manager at ShareAction, said: “There is no excuse for a highly profitable company with multimillion-pound executive salaries refusing to guarantee all its staff, including subcontracted workers, a basic standard of living.”