The billionaire Issa brothers are trialling a four-day week at Asda as they seek to stamp out a revolt among disgruntled store managers, The Telegraph can reveal.
The British supermarket giant is attempting to rebuild relations with senior employees after a barrage of cost cuts and concerns over culture have led to managers “leaving in their droves”.
A presentation released late last year revealed details of Asda’s “leadership structure trial”, as management raised concerns over a 13.9pc jump in turnover among retail managers in 2022.
It said the rate of attrition has “impacted the stability and capability of our teams in store which in turn has impacted the colleague experience and by extension our customers”.
Asda said in the presentation it is pursuing a “case for change” among store managers, with the four-day week trial set to be concluded later this month, which will also include experimenting with other flexible working arrangements, such as shorter shifts.
It comes as scrutiny mounts on the Issas’ running of Asda, as billions of pounds of debt bear down on the business and its market share lags behind rivals Tesco and Sainsbury’s.
Strain at the top of the Issas’ empire has also led to talk of a rift between Mohsin and Zuber, with tensions said to be running high over a private family matter.
A source close to the brothers rejected the speculation last month.
However, issues at Asda pose an ongoing headache for the Blackburn-based brothers, particularly Mohsin who has led the supermarket since it was bought from Walmart in a debt-fuelled £6.8bn deal three years ago – backed by private equity giant TDR Capital.
Over the past 12 months, Asda’s market share has fallen from 14.2pc to 13.6pc, according to data from Kantar.
The retailer is also braced for its first-ever strike later this month, with employees at a superstore in Gosport set to walk out from Friday 19 January.
A former Asda store manager who left last year after just two years accused the Issas of “running the business into the ground”.
The ex-employee, who asked to remain anonymous, said: “I can honestly say its the worst company I’ve ever worked for.
“You wouldn’t have got away with the nonsense I saw under Walmart.
“In my store, there were more than 350 people. Scores of colleagues left that store alone. A manager I worked with had been there for 25 years and she left because she’d had enough.
“When you have such a breakdown from above and no process that’s being adhered to, that’s when you risk a riot. And unfortunately for Asda, it’s now a full-scale riot.”
In response to the claims, a source close to Asda said: “We simply don’t recognise these comments from a former colleague. The current owners have significantly invested in the business in a way that Walmart chose not to do in the latter years of ownership – Asda was not their priority.”
Nadine Houghton, a national officer at GMB Union, said she is hearing daily from “disgruntled managers” facing pressure to run stores with fewer resources and greater pressure from above, adding that “managers are leaving in their droves”.
She said: “Asda has been forced to accept that all is not well amongst their managers and are attempting to address some of the issues by trialling a reduction in managers’ weekly working hours.
“Unfortunately, this does not address the realities on the shopfloor; traders not being left to trade to their local communities and a continuing decline in the resources available to do their job.
“At some point, Asda will have to accept that a radical overhaul is needed if it wants to attract the talent required to make Asda a success.”
The supermarket’s operations have come under increasing scrutiny in recent months, as Mohsin has been hauled before MPs on two occasions to answer questions about Asda.
A senior industry source said Asda’s problems stem from Mohsin holding too much power at the top: “This is a business with 140,000 people and armies run on leadership – you want the whole army marching in step.
“The problem is that you have got a chief executive who doesn’t understand that scale of business. There seems to be a disconnect between what’s happening in his head and what’s happening on the ground.
“You just need to look at market share. Tesco and Sainsbury’s are having it away while Asda is in the toilet.”
An Asda spokesman said: “Since September 2023, we have been trialling a variety of flexible working patterns for managers in 20 stores, including a four-day working week for the same pay and benefits.
“There has been no reduction in the number of hours that hourly-paid colleagues are contracted to work as a result of this trial.
“While we are still evaluating the results, the feedback from participating colleagues has been very positive.
“Asda has also invested a total of £325m in increasing pay for both store-based and logistics colleagues since 2022. For the record, Asda saw a 6pc reduction in colleague turnover between 2022 and 2023.”
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2024-01-13 18:00:00Z
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