Marks & Spencer is planning to cut redundancy benefits for its 60,000 staff by up to 25%.
Under the new redundancy package, which the retailer wants to introduce by 1 September, the maximum payout employees can receive in relation to their length of service will be slashed from 70 weeks to 52 weeks. For example, all staff members aged over 41 years, meanwhile, will receive three weeks' pay for every year worked instead of the 3.75 weeks they receive at the moment.
This means a typical employee aged 49 years with 30 years' service will be paid £26,000 instead of £35,000, while a typical 41-year-old employee that has worked with the retailer for five years would be paid £7,500 instead of the £9,375 they would currently receive.
The move has prompted fears of job losses and is currently being discussed between the store's national employee representatives and senior executives.
A Marks & Spencer spokeswoman said the new payouts would still be higher than the statutory requirements and those of other retailers. "Any business has to do this from time to time. We have not done this since 2006. We needed to look at it and make sure it was up to date and in line with the rest of the market. It's still ahead of our competition," she said.