Asda to scrap 10,000 bonuses for managers amid cost-cutting plans
Bonuses were axed just months after chairman Allan Leighton returned to run the supermarket after more than two decades to help lead turnaround plans for the group
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Asda is reportedly set to axe the bonuses of thousands of workers as it looks to cut costs amid troubled trading. According to The Telegraph, more than 10,000 managers were told that they will not receive the payouts, having usually expected to receive bonuses in the first three months of each year.
Bonuses were axed just months after Asda’s new chairman Allan Leighton returned to run the supermarket after more than two decades to help lead turnaround plans for the group.
In January, it was reported that Leighton told staff that multiple regional manager roles will be axed in a bid to overhaul the business, after the group suffered poor sales over the Christmas period.
Some 13 regional manager roles were reportedly cut as part of the restructuring in a bid to shore up costs.
In a memo released to staff on 7 January, Asda reportedly said the restructuring will mean that all supermarkets and express stores will now be managed across 22 sub-regions, down from 30.
That same month, Leighton reportedly restarted the hunt for a new CEO after a failed effort by his predecessor, Lord Rose.
The company has been without a permanent CEO since the departure of Roger Burnley in August 2021 following a fallout with Asda’s private equity backers, TDR Capital. Following Burnley’s departure, co-owner Mohsin Issa took over in 2022 while a replacement was sought.
Following his appointment, Leighton warned that a turnaround of the business could be a three to five year process.
Speaking to The Guardian shortly following his appointment, Leighton said that his priority was now to “restore Asda’s DNA” through finding a new CEO, as well as improving pricing and availability. He claimed three to five years will “take us that long to get it right”.
The restructuring comes as Asda witnessed its worst Christmas since 2015. In the 12 weeks to 29 December, sales fell by 5.8%, while Asda’s market share fell to 12.5% in December, down from 13.5% last year.
Asda has been contacted for comment.
