John Lewis underpaid staff £40m shortfall
Jim Armitage is the City editor of The Independent and London Evening Standard group of newspapers. He has been a reporter and editor for more than 20 years and was recently shortlisted for the Press Gazette financial journalist of the year and The Society of Editors financial journalist of the year awards. He contributes news, investigative reports and comment to the Independent titles plus a daily column in the Evening Standard.
Friday 23 August 2013
John Lewis Partnership staff were yesterday congratulating a sharp-eyed call-centre worker who spotted that the firm had been accidentally underpaying them for seven years. In pay packets arriving yesterday and today, they received additional windfalls of up to £4,000.
In total, the partnership, which includes the Waitrose supermarket chain, will be forking out £40m for the blunder, with a further £7m going on future pension liabilities.
The employee had recently joined from another firm and noticed that he was not receiving the same benefits for working Sundays and bank holidays as he had in his previous job. He approached the human resources department about the issue last month.
Under the UK's Working Time Regulations legislation, holiday pay for employees should reflect hours that were worked at premium rates, such as weekend shifts, over the previous months.
A spokesman said the average payout will be £350, with the largest running to thousands depending on the workers' shift patterns and pay grades.
He added that John Lewis had already been reviewing its pay policy under what are widely seen as increasingly complicated rules.
Employment lawyers said that John Lewis Partnerships was unlikely to have been the only employer making such underpayments to workers, as many companies have struggled to interpret what are complicated regulations.
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