The End of an Era? Why John Lewis Scrapped Staff Bonuses Again

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For decades, the John Lewis Partnership (JLP) has been celebrated for its employee-ownership model, where staff—known as ‘partners’—share in the company’s profits through annual bonuses.

However, for the third consecutive year, the retail giant has decided to withhold staff bonuses, despite reporting a significant rise in profits.

A Turnaround Without Perks

John Lewis recently announced that pre-tax profits surged by 73% to £97 million, while underlying profits tripled to £126 million.

Despite these strong figures, the company stated that it would not reinstate the annual partner bonus, a move that marks a major shift in its historical employee benefits strategy.

Instead, the company has opted to increase base wages by 7.4%, raising hourly pay to £12.40 (or £13.85 in London), ensuring partners earn above inflation levels.

While this aims to support long-term financial stability for employees, many still see the loss of the bonus as the decline of a once-beloved tradition.

Why No Bonuses?

JLP Chair Dame Sharon White cited the need to strengthen the company’s balance sheet as a key reason for cutting bonuses. “We have made substantial progress, but we need to ensure that our business remains financially sustainable for the long term,” she explained.

Other contributing factors include:

• Cost Pressures: Rising operational costs and inflation continue to impact retail profitability.
• Workforce Reduction: The company has streamlined operations, reducing its workforce by approximately 4,000 roles.
• Investment in Growth: John Lewis is investing £600 million in store renovations, supply chain improvements, and digital transformation.

Staff Reaction & What’s Next

While wage increases have been welcomed, many employees remain disappointed. The John Lewis bonus has been a defining element of the company’s culture since 1953.

Some staff fear this signals a shift away from the core principles of the partnership model.

Looking ahead, JLP remains focused on its transformation plan, with hopes that financial stability will eventually allow for the return of staff bonuses.

However, the decision raises a key question: Is John Lewis still the gold standard of employee-owned businesses, or is this the beginning of a fundamental shift in its values?

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