LONDON, 2016-Sep-05 — /EPR Retail News/ — Marks & Spencer today (02 Sep 2016) announces that it has completed a thorough consultation with its national employee representative group (Business Involvement Group) on proposed changes to pay, premiums and pension and reached an agreement on a number of key issues.
Sacha Berendji, Marks & Spencer Retail Director said: “We’ve listened to our colleagues, acted on their feedback and are pleased that we’ve reached an outcome that gives enhanced support for our colleagues as well as making necessary changes to our business. From April 2017 our people will be amongst the highest paid in UK retail and receive one of the best benefits packages. The changes will reward our people in a fair and consistent way, simplify and modernize our business and help us attract and retain the best talent so we can continue to provide great service for our customers.”
John Dorrington, Chair of the Business Involvement Group, said: “On behalf of the Business Involvement Group, our elected employee representative body, we are satisfied that we have concluded a period of robust collective consultation where all views from across M&S have been strongly represented. In our view the business has listened carefully to all views and suggestions and as a result has made a number of key changes to the original proposals.”
Pay and premiums
The proposed pay increases and premium changes will go ahead. Customer Assistants will get a 14.7 per cent rise to £8.50 an hour (£9.65 in Greater London) from April 2017 and there will also be pay rises for Section Co-Ordinators and Section Managers. The Customer Assistant rate is significantly above the National Living Wage (£7.20) and above the wage campaigned for by the Living Wage Foundation (£8.25 outside London and £9.40 in London).
Premium payments will be simplified and made consistent across our UK retail employees, including removing premium payments for Sunday working and moving to one standard payment for Bank Holidays.
The vast majority of colleagues will receive higher pay as a result of the changes to pay and premiums, however a significantly improved additional offer means that all colleagues will either receive higher pay or have the opportunity to maintain their current pay level.
For two years, pay will be topped up to 2015/16 levels for any colleague that would receive lower total pay as a result of the premium changes. In 2019/20, any colleague that would still receive lower total pay compared to 2015/16 levels will receive an additional top up payment of 50% of their reduction in total pay and be offered guaranteed extra hours to make up the remaining 50%. The additional hours are optional and would be no more than three hours a week. The vast majority of colleagues in this group would only need to work an additional 45 minutes a week to make up their pay to 2015/16 levels.
In subsequent years an additional top up payment and guaranteed hours will be offered annually until a colleague’s pay reaches 2015/16 levels as a result of other potential changes to a colleague’s pay.
Pension
The proposed pension changes will also go ahead with active members of the M&S Defined Benefit scheme no longer earning new benefits in that scheme from April 2017 and being offered the chance to join the company’s Defined Contribution plan.
As part of the pension changes the company has agreed to extend the cash supplement support (offered as part of the proposals) for affected colleagues from two to three years. It will also maintain the death-in-service benefit at four times salary for members of the Defined Benefit scheme that choose not to enroll in the Defined Contribution plan. Additionally, after discussion with the company’s pension trustees, early retirement factors for all deferred members of the Defined Benefit scheme will be improved.
The outcome has been announced to colleagues today. There will be a series of briefings and the company will write directly to colleagues with details of the improved offer and what it means to them. Colleagues will only be eligible for the transition support if they agree to the changes.
The outcome of the three month consultation process has been approved by the Marks and Spencer Group plc Board and the changes will take effect from April 2017.
As referenced in M&S’s Prelims statement on the 25 May 2016, these changes are not expected to significantly impact on underlying costs in this or the next year financial year. However, there will be a non-underlying charge in the current financial year in the range of c.£100 m to £150 m. This non-underlying charge is largely driven by the Defined Benefit pension changes because when current active members become deferred members, the annual increase in their pensionable salary is linked to CPI as opposed to being capped at 1%.
For further information, please contact:
Corporate Press Office: 0208 718 1919
corporate.press@marks-and-spencer.com
Source: Marks & Spencer