Zero-hours JD Wetherspoon staff scoop £22m

JD Wetherspoon kitchen and bar workers reap rewards of cheap-drinking boom in downturn

Mikkel Stern-Peltz
Saturday 07 September 2013 20:22 BST

Tim Martin will hand over a £22m bonus pot to more than 20,000 kitchen and bar staff on zero hours contracts at his cut-price JD Wetherspoon pubs empire this week.

Wetherspoon has boomed during the downturn due to its range of low-cost but well-regarded regional ales, like Ringwood 49er and Highland Scapa Special.

The fast-growing chain, chaired and founded by the notoriously Eurosceptic Mr Martin, is expected to hand out nearly 90 per cent of its £25m of share and cash bonuses to employees.

The average £1,000-plus bonus will be a welcome boost to the thousands of staff who are on little more than the £6.09 minimum wage, while many 18-20-year-old employees earn less than £6 an hour.

It was revealed in August that close to 80 per cent of the cheap-ale pub chain's 30,000 employees are on controversial zero-hour contracts. The employment contracts were criticised for not having guaranteed hours or a schedule, but zero-hour employees who meet certain criteria will have access to the scheme.

Workers who have been at the company for more than 18 months are offered free shares in the business, as part of an incentive plan. Employees are also entitled to a bonus of between 19 per cent and 50 per cent of their pay, depending on their job title.

Over the past five years the chain of nearly 900 UK pubs has paid out approximately a third of its pre-tax profit to employees in the form of bonuses and free shares. Last year, these amounted to £24.1m, "85 per cent of which was paid to employees working in our pubs", according to Wetherspoon's full-year report.

Last year, £5.7m was paid out in free shares. Market analysts suggest that for this "very strong year" the figure will have risen to between £6m and £7m, as the chain expected to post record profit of £76m before tax.

In a 2012 interview, founder and chairman, Mr Martin, said he believed these incentive schemes were part of the reason that "our pub managers have been with us for an average of nine years".

Early this year, Mr Martin, who is known to be partial to Leffe Blonde and Doom Bar, announced plans to open pubs in service stations, starting on the M40. Though the plans were criticised by many, Mr Martin saw it as the start of a new area of business for his chain, saying: "Hopefully it will be the first of many Wetherspoons on the motorway."

Wetherspoon's first-half profit was £34.8m, off a revenue of £626.4m.

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