British department store John Lewis has reportedly slashed redundancy payouts in order to support its ongoing turnaround plan, hinting at potential further job cuts across the company.
In an internal memo seen by The Telegraph, the retailer said it was set to half its two-week redundancy pay per year of service policy to make it “more affordable” and to “free up cash”.
According to the company, its policy was “higher than typical market practice and comes at a very high cost”, consisting of both partnership redundancy pay and statutory pay, set by the government.
The move was deemed a “last resort” by John Lewis, which noted that most of its staff would remain unaffected by the changes.
In the memo, the company highlighted that “the high cost of redundancy pay has been one of the things that’s prevented us from moving as quickly as we’ve wanted to transform ourselves for the future, and has restricted our ability to invest more in pay”.
A spokesperson for John Lewis added: “We’re making changes as a high proportion of our current benefits package is weighted towards partners after they have left, when we want to better reward those currently working for us.
“These changes will allow us to invest more in our partners still within the business.”
