Asda will begin a new round of cost-cutting before its proposed merger with rival Sainsbury’s (LON: SBRY), risking 2,500 jobs.
The supermarket has been owned by the US retail giant Walmart (NYSE: WMT) since 1999 and is looking to reduce operations across all stores, affecting staff in bakeries, petrol stations and back office roles.
Asda said in a statement: “In a competitive retail market, where customers rightly expect great value and ease of service, we must always look at how we can work more quickly and efficiently for them – and inevitably, that means we need to consider changing the roles we need our colleagues to do or the hours needed in particular parts of our stores.”
The GMB union, which represents employees working at Asda has said that it will “fight tooth and nail for every single job”.
Gary Carter, the national officer of the GMB trade union, said: “These proposed redundancies are a hammer blow to Asda workers. The timing of this announcement, in the run-up to Christmas, is doubly appalling. Asda is performing well and is highly profitable because of the hard work of our members.”
“These cuts make no sense whatsoever. Slashing our members’ jobs would hurt the service Asda customers receive. With all the speculation surrounding the proposed Sainsbury’s merger and potential sell-off of stores, this news will not put anyone’s mind at rest.”
Last year Asda cut 300 jobs at the head office in a round of cost-cutting. It also cut jobs in 18 underperforming stores, whilst also asking staff in another 59 stores to work more flexibly.
Sainsbury’s proposed buyout of its rival is being investigated by the Competition and Markets Authority (CMA).
Last month, the CMA said there were 400 stores where the combined group may have to close stores as there was a “realistic prospect of a significant lessening of competition”.
