Social Governance

Sainsbury's Upcoming Meeting will Face an Investor Vote on Workers' Pay

Published on: 6 June 2022 06:37 PM

At its annual meeting next month, Sainsbury's shareholders will have the chance to vote on a resolution calling for the UK's second-largest supermarket chain to commit to paying all of its employees the so-called true living wage by July 2023.

The first living wage shareholder resolution submitted by a British corporation, according to ShareAction, "will be a litmus test for investors' environmental, social, and governance (ESG) promises to protect workers amid a spiralling cost of living crisis."

ShareAction, a responsible investing group that coordinated the submission of the resolution in March by an investor coalition that included Legal & General and Nest, said on Monday that talks with Sainsbury's had come to a halt and that the resolution would proceed to a vote at the meeting on July 7.

According to how much employees and their families need to live, the real living wage was devised by the Living Wage Foundation charity and independently calculated by the Resolution Foundation think tank.

More than 10,000 companies, including Google, have committed to paying a true living wage. The Bank of England is keeping a careful eye on pay deals as it assesses the possibility of the recent spike in inflation to a 40-year high of 9% becoming ingrained in the economy.

The current hourly rates in London are 11.05 pounds ($13.92) and 9.90 pounds in the rest of the United Kingdom. In comparison, the major government-mandated minimum wage rate in the United Kingdom is 9.50 pounds per hour.

It has been paying real living wage rates to all of its directly employed personnel since May, but not to third-party contractors like cleaners and security guards, according to ShareAction.

Sainsbury's was one of the first major retailers to pay all store employees the living wage, and the majority of its contractors were paid at or above the living wage.

The company's spokesperson said, "To effectively balance the needs of our customers, colleagues, suppliers, and shareholders, we must preserve the right to make independent business decisions that are not determined by a separate body."

Sainsbury's advises shareholders to vote "no" on the proposal. The corporation employs 189,000 people, making it one of the largest private employers in the United Kingdom.

Source: Bollyinside

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