Retail

Tesco Offers Salary Advance To Help Staff Navigate Cost-Of-Living Crisis

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Tesco, Britain's biggest retailer and one of the country's largest private-sector employers, is offering its staff advances on their pay to help them navigate a worsening cost-of-living crisis, it said on Friday.

UK shoppers face a record hit to living standards this year as surging inflation erodes incomes, the country's budget forecasters warned on Thursday, after finance minister Jeremy Hunt announced more pain, with tax rises now and spending cuts further ahead.

But with the country's labour market still tight, retailers are having to repeatedly hike wages and offer other benefits to attract and retain staff.

Under the Tesco scheme some 280,000 workers in the UK can receive up to 25% of their contractual pay early.

It said the idea is to help staff avoid having to take on expensive debt with high interest payments, such as pay day loans.

Salary Advance

Tesco workers would have to pay a £1.49 ($1.76) fee per advance to its financial employee benefits partner Salary Finance. Staff are allowed one advance per pay period.

"We hope this helps to support colleagues, particularly in the run up to Christmas," Tesco's UK people director James Goodman said.

Tesco announced a second pay rise in a year for hourly-paid staff in October, equating to a nearly 8% rise over the year.

However, inflation hit a 41-year high of 11.1% in October.

The company has forecast full-year core profit to be around the lower end of its previous guidance, saying there were significant uncertainties over the macro outlook.

News by Reuters, edited by by ESM – your source for the latest retail news. Click subscribe to sign up to ESM: European Supermarket Magazine.

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