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Next boss to forgo bonus to subsidise store staff pay rise

Next chief executive Lord Wolfson will take no bonus this year so the company can increase standard entry-level wages by at least 5% in its annual October wage review.

He sent a letter to staff, seen by Drapers, which said: “In the event there is a shortfall in funding, I have agreed with the board that any bonus I might be due in the year ahead, will be used to help fill the gap. Spread across so many people my future bonus might not amount to a great deal per head, but I hope at least it will convince you of the company’s sincerity and determination to improve your wages and still remain competitive.”

Next said it increased entry-level rates by 6% and increased average contract hours last year, which meant the average staff member earned a third more than two years ago.

About half of Next’s 50,000-strong workforce are employed in entry-level roles.

The pay rise for October will take the hourly rate from £6.70 to £7.04 and to an estimated £7.58 including bonuses.

The national minimum wage is £6.50 and will rise to £6.70 in October.

Lord Wolfson’s letter follows claims by Citizens UK that retailers including Next are being “subsidised” by the taxpayer as employees are forced to take in-work benefits to supplement their incomes.

The living wage, calculated by the Living Wage Foundation, is £7.85 nationally or £9.15 in London.

@Tara_Hounslea

Readers' comments (1)

  • Absolute brilliant leadership by Lord Wolfson. A great example to us all, and particularly to those who know that a business can not operate and be successful without incentivised and motivated staff.

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