John Lewis keeps bonus freeze despite profit jump

Retailer John Lewis has mentioned its employees won’t obtain a bonus for the third 12 months in a row, regardless of reporting a soar in annual earnings.

The worker-owned retail partnership, which additionally contains the Waitrose grocery store chain, mentioned earnings final 12 months rose by 73% to £97m.

Nonetheless, it has not restored the employees bonus, saying it will spend money on its enterprise and employees’ pay as a substitute.

The John Lewis Partnership employs about 73,000 folks, and earlier this month it mentioned store employees would obtain a 7.4% pay rise this 12 months.

That is the fourth time in 5 years that John Lewis has not paid a bonus.

The string of freezes began in 2020 – the primary time it had scrapped them since 1953 – after it was hit by Covid lockdown retailer closures.

The outcomes are the primary underneath the partnership’s new chairman, Jason Tarry.

“We’ve got made good progress with rather more nonetheless to do,” Mr Tarry mentioned.

“Wanting ahead, I see vital alternative for progress from each our Waitrose and John Lewis manufacturers.”

Waitrose gross sales grew 4.4% to £8bn, and it bought extra of its own-brand merchandise.

John Lewis mentioned that whereas it anticipated the financial setting to be “difficult for our prospects and our enterprise” within the 12 months forward, it was nonetheless assured it may push up earnings.

Charles Allen, a Bloomberg Intelligence analyst, mentioned the dearth of bonus “had been signalled”.

“I additionally assume we’ve to place within the mild of one other massive pay elevate that is coming via in step with the minimal wage soar.

“After which after all, though the companions do not see it, you have received a really giant rise in employer nationwide insurance coverage as nicely.”

John Lewis has been making an attempt to win again prospects with a restoration plan after a troublesome few years that noticed it lower jobs and shut a number of shops.

In March 2024, it reported its first annual revenue after years of losses, but in addition mentioned it will not pay a employees bonus.

In September final 12 months, it introduced again its “by no means knowingly undersold” value pledge, two years after abandoning it.