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We’ve filed a Living Wage resolution at Sainsbury’s – here’s why

We’ve co-ordinated a coalition 10 institutional investors worth £2.2 trillion and 108 individual investors to file a shareholder resolution calling for Sainsbury’s to accredit as a Living Wage employer and commit to paying all its workers a wage that meets the cost of living.

We’ve got some big news!

We’ve joined 10 institutional investors and over 100 individuals to co-file a Living Wage resolution at the UK’s 2nd largest supermarket.

The resolution would see Sainsbury’s become the first Living Wage accredited supermarket in the UK.

If passed at the company’s AGM in July it would commit the companies to pay ALL its workers a wage that meets the cost of living.

Not just now - but in the future too.

The real Living Wage is calculated according to the cost of living.

That works out at £11.05 in London and £9.90 for the rest of the UK.

Living Wage accredited employers commit to paying at least these rates to both direct and subcontracted staff.

We’re facing a cost of living crisis which could throw millions more into poverty

This resolution comes at an important moment.

Food banks are recording unprecedented numbers and some 2.5 million more families plunged into fuel poverty this spring.

Those in low-paid work will be amongst the hardest hit.

With the combination of higher National Insurance contributions, Universal Credit cuts, and a freeze on the income tax personal allowance, the average supermarket worker will be £1,040 worse off in 2022.

Despite being recognised as ‘key workers’ during the pandemic, no supermarket is accredited with the Living Wage foundation

The Covid-19 pandemic highlighted the role supermarket workers have in underpinning our economy and society.

It exposed the extent to which we rely on low-paid and insecure workers – including those working in our supermarkets.

Yet, supermarkets themselves have seen increased profits.

In January, Sainsbury’s reported expected profits of at least £720 million.

Many supermarkets are recognising the importance of their workers.

Over the last two years, we’ve seen movement towards higher base rates of pay in the sector.

In April 2021, for example, Morrisons became the first supermarket to guarantee at least £10 an hour to its direct staff.

Others have since joined them in paying higher rates.

However, 42 per cent of all supermarket workers in the UK still earn below the real Living Wage.

One in three Sainsbury’s workers reported that they regularly worry about putting food on the table.

This was at the same time its CEO took home £1,319,000.

Only accrediting as a Living Wage employer will ensure all Sainsbury’s workers earn a wage that meets the cost of living

Sainsbury’s has taken important steps to address this imbalance.

In January 2022, it announced that it would be increasing workers’ base pay to £10.00 per hour for directly employed staff outside of London.

This move is welcomed. But it leaves many of those working for Sainsbury’s still falling short of a wage that meets their needs.

Sainsbury’s announcement did not extend to third-party staff, such as cleaners and security workers - roles essential to the success of its business.

These roles are some of the lowest-paid and most insecure.

Often described as ‘invisible’ they are often not included in workforce reporting such as pay ratio reporting.

But Sainsbury’s has a responsibility towards these workers too.

On top of this, the supermarket has not provided the certainty workers need that wages will continue to increase to meet the cost of living.

By accrediting as a Living Wage employer it would show a commitment to all workers that they will continue to earn a wage that meets their needs, both now and in future years.

This is what the resolution calls on Sainsbury’s to do.

Ensuring all workers earn a Living Wage is not only a social imperative, it is also good for business

There are well-documented business benefits to paying higher wages. This includes higher staff engagement, higher productivity, reduced turnover, and training costs.

75 per cent of accredited Living Wage employers have reported that accreditation led to increased motivation and retention rates for employees.

89 per cent of accredited retailers found that it enhanced their reputation.

This is why large institutional investors have got behind the resolution.

Both the UK’s largest asset manager, Legal and General Investment Management, and the largest workplace pension scheme, Nest joined us in co-filing this resolution.

Sainsbury’s has an opportunity to drive change across the supermarket sector

Accrediting as a Living Wage employer would see Sainsbury’s live up to their public commitment to ‘always focus on doing the right thing for our people’.

Over 9,5000 UK companies – including 50 per cent of the FTSE100 – are now accredited Living Wage employers.

Not a single supermarket is amongst them.

As the second-largest supermarket in the UK, this is an opportunity for Sainsbury’s to be a leader and set the expectations for the sector – that all workers should earn at least the real Living Wage.

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