Ex-Sainsbury Boss Slams New National Living Wage
Not an unexpected response from a businessman. What is amusing is his comments come in the same week that Sainsbury's announced that from 30 August its 137,000 shop-floor staff, including workers under 25, will see their standard rate of pay rise 4% to £7.36 an hour while the new NLW will be 16p an hour less from April 2016. I'm surprised the author of the article didn't make more of the contradiction. 
http://www.bbc.co.uk/news/business-34090038
http://www.bbc.co.uk/news/business-34090038
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He was on question time a few years ago. He revealed his salary was £900,000pa. Not sure if that includes any extras like bonuses, dividends or the like. You can guarantee that whatever the present guy is on today. It's going to be more.
He has a history of thinking staff are too well paid. While at Sainsburys in the same week he was given £500,000 worth of shares he axed the £100 Christmas bonus paid to staff. Not exactly endearing himself to his staff.:(
He also avoids tax as you do he gave half his Sainsburys shares to his wife as part of financial planning, and she then went and divorced him.
TBH, our pay compared to other supermarkets is pretty good, Tesco gets a bit more, but they don't get paid for breaks and Aldi pays more, but I think you have to pay your own stamp with them.
Morrisons and Asda pay less.
Any company will have a wage budget and with most SMEs that means paying less people to pay the remaining ones more. Hence the possibility of rising unemployment.
It's worse than that, the entire raison d'être of Capitalism is the efficient allocation of capital. But our system is allocating a lot of capital that apparently requires state subsidy for it's employees to work. With no planning.
So we have no efficient aallocation of capital but no overall plan for the benefit of the country.
I think you will find that a lot of their workers are part time. You can't expect any business to pay a full time wage for part time work.
No he wasn't but the fact remains Sainsbury are paying more than the new national living wage will be so it does make his comments rather contradictory.
Sure company's have wage budgets but on the other hand they can't operate without staff and I doubt they are employing more than they need and those on low incomes appear to need in-work benefits to make ends meet. Businesses need to get their heads round the fact welfare payments for those in work far exceed those paid to those out of work and that is a ridiculous situation. If businesses need to pass increased staff costs on to customers then so be it that is how it supposed to work not taxpayers funding in-work benefits.
I never get why some people are so eager for poorly paid workers to remain poorly paid. Those same people never seem to have a problem with the very rich getting richer on the backs of the poorly paid. Give a poor man an extra tenner and he will spend it on goods and services in his local area. Give a millionaire an extra tenner and it will go to an overseas account
I don't think anyone is.
I didn't say that. If the majority of a company's workers are part time how do you expect them to stay in business if they pay everyone enough not to have some benefit?
They would either go bust and everyone is out of a job or prices rise astronomically which just puts everything back to square one.
What generally happens is if you give an entrepreneur more money he will expand his business and employ more people. So they have more money (and much more than a tenner) and spend it on goods and services in the local area.
I think the point is: If there's money to pay the chief exec (plus senior management) £900,000pa and upwards. Then there's money to increase shelf stacker pay. Even if it's only by a few pence. Knocking a zero of his salary or even reducing his benefits package won't put King below the poverty line. But keeping shelf stacker wages stagnant will. It shouldn't be upto the taxpayer to subsidise the company wages when the company is sitting on a huge pile of case.
You think this guy spends his millions in local shops? Six million bonus, think about if he got half that plus salary and the three million left over goes on a pay rise? Same cost but instead of one guy benefiting, many folk benefit. What is so wrong with that?
An entrepreneur in many cases yes, but directors of publicly quoted companies, like Sainsburys, aren't entrepreneurs. Extra pay for them goes into their pocket, not the company..
The bizarre thing is that he says the LW will make companies become more productive, adding that will cause job losses. Isn't he aware that the more productive a company becomes the more it and its employees have to spend?
That comment of his didn't properly register first time i read the article, until you pointed it out. Some of the excuses fat cat directors of big corps make to avoid paying their lowest earners a wage that can be survived on is laughable. So is he actually sort of claiming minimum wage is cheap as chips so they can afford to overstaff, but if minimum wage goes up they'll need to find 'efficiency savings' and cut back on the number of low waged staff? If he wanted to save 510 workers salary costs, on the basis he used to earn £900k and in a really good year get £6M bonus, he could just sack himself instead. (After all i worked for a big corp once and it ran smoothest the days senior mgmt were all off-site on some mgmt day, so Sainsbury's wouldn't have missed him).
The only trouble is that the UK competes against lower paid people in the rest of the world, which is causing employment groups like farmers immense problems, so inexorably rising wages will cause problems.
If you read my previous post before jumping in I said it didn't refer to the likes of Tescos but the SMEs who employ far more people overall and the who are the entrepreneurs.
As another poster mentioned Sainsbury's have already said they will give their employees an above inflation rise of 4%. It's not the like of them that will be affected but the smaller companies and it could break them. The consequences of which would be a rise in unemployment.
The comments of the former Sainsbury's boss are almost immoral from a man with his take out of that business.
What's needed is the same sort of tough revolution that occurred with the unions decades ago. No chance of that occurring with the Conservatives in power though is there?
Lots of people do benefit though.
Looking at the basic of £900,000, he'll be paying up to £390,000 in tax.
Looking at the total alleged package of £6,900,000, that's £3,090,000 in tax.
So, his tax is paying for between 105 and 825 people to receive a job-seekers allowance every week.
It would be interesting if we were to start personalising things. Where people who receive benefits were told the name of the person who was funding them.