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Supermarket chain Asda is considering whether to cut the pay of 7,000 staff in the south east of England to bring it in line with its other stores.
Staff at 39 stores outside the M25 have been paid more for decades to offset a higher cost of living closer to London.
A spokesperson said all Asda staff had recently been given a 10% pay rise to help with soaring inflation.
The GMB union said Asda was set to fire workers who refused to agree to the new conditions.
The union said the workers were already low-paid, and that planning to reduce pay during a cost-of-living crisis was “inexcusable”.
The workers get a so-called “location supplement” of 60p per hour, which Asda may scrap, and a night supplement that it wants to reduce, the GMB said.
It added that those who do not agree to the pay reduction “could be dismissed if they refuse to sign” the new contract.
The consultation is happening at the moment, and Asda plans to bring in the changes in November, the union said.
It accused Asda-owners the Issa brothers of laying the ground for a “debt laden merger” between Asda and EG Group’s UK petrol stations – which the brothers also own.
“These slash and burn tactics, along with food and fuel price increases, will only ramp up if the merger goes ahead,” said GMB organiser Nadine Houghton.
However, an Asda spokesperson said the collective consultation was “in a small number of stores” where workers were paid 60p per hour on top of the £11.00 per hour national rate.
“This supplement is out of line with the wider retail market and has created an anomaly where some Asda colleagues in stores that are close together are paid different rates,” the spokesperson said.
Asda is discussing a “compensatory payment” in return for removing the supplement.
“These discussions are ongoing and no final decision has been taken,” the spokesperson added.
Asda has about 140,000 employees in total.