4 days ago
John Lewis considers awarding staff bonus for first time in four years
John Lewis is poised to reinstate its prized staff bonus for the first time in four years after upbeat trading put it on course for higher profits.
The retail partnership, one of Britain's largest mutuals, is considering paying out the bonus to 69,000 workers after a turnaround in performance at its flagship stores.
According to internal documents, the group's board will be asked to recommend reinstating the payout if pre-tax profits reach £200m for the year to February 2026.
Profits last year totalled £126m, up from £42m, and sales are expected to have increased in the first half of 2025 – leaving it well positioned to hit the milestone.
The documents, seen by the Financial Times, said John Lewis expected to pass the £200m threshold and added 'to get there we need to keep focused on the right things and deliver our plans'.
Bringing back the payout would mark a major win for Jason Tarry, the new chairman who joined the retailer last September replacing Dame Sharon White.
The former UK chief of Tesco has steered a turnaround drive at the partnership, with bosses saying they are now 'relentlessly focused' on retail again having dabbled in financial services and housing.
John Lewis, which also owns grocer Waitrose, first cancelled the prized payout in 2020 having paid the bonus every year since 1953. It was briefly reinstated in 2022 but has not been paid since amid a tougher trading environment.
Despite tripling profits last year, the group said it had 'prioritised' higher pay for staff as well as other investments instead of paying the bonus.
The move prompted anger from members, who campaigned to get the payout reinstated.
A staff petition launched earlier this year said that workers were 'working harder than ever' but many were 'getting less recognition'.
'The bonus meant something more than just money. It was a sign that the company saw and appreciated us,' the letter said.
John Lewis has faced a variety of struggles in recent years, including navigating the pandemic as well as rising levels of online shopping destroying trading in its bricks-and-mortar stores.
In 2021, under Dame Sharon, it suffered a £648m loss because of a significant write-down on the value of its shops as well as restructuring costs. On the back of this, the retailer launched a five year cost-cutting plan to try and return to profit.
The partnership paid a record £116m in salaries last year and raised its minimum pay to £11.55 an hour.
Reviving the payout hinges on trading remaining successful for the rest of the year.
A John Lewis spokesman said: 'As we said at our full year results in March, we expect to increase our profitability in the coming year.'
