John Lewis to turn down government staff retention cash

By

Sandra Halliday

Published
Jul 13, 2020

John Lewis is to become the latest big-name retailer to reject government money to bring staff back from furlough following news that Primark will turn down the cash.

The UK government is offering a bonus of £1,000 per worker for companies who bring back staff from furlough and agree to keep them employed until January. 

Primark has reportedly said that it won't be using the money and John Lewis is set to do the same. With around 14,000 staff on furlough, this means that it could be saying no to a grant of around £14 million. In the case of Primark, the grant would have been worth around £30 million.

While those are large sums, they’re relatively small in the grand scheme of things for both John Lewis and Primark and in some ways the PR value of saying no to the money is more important than accessing the cash. 

A number of retailers have suffered from bad PR during the lockdown, whether through allegedly unsafe working conditions or taking government money when they were perceived to be well funded. 

A varying range of businesses from Frasers Group to Victoria Beckham, Boohoo, Next, Net-A-Porter and Asos have all seen negative headlines that in many cases forced them to reverse decisions they had taken.

In the case of Primark, the Treasury called it a “credit to our country”. Coming at the same time as Boohoo is facing a deluge of criticism over alleged use of Leicester sweatshop factories, that’s an important endorsement for a company that has itself been criticised in the past.

For John Lewis, its employee ownership structure and general determination not to behave like some other retailers, means it’s also an important decision. Coming at a time when the company is planning to shut down eight of its stores permanently, John Lewis needs to be seen to be doing the right thing.