J Sainsbury (LON:SBRY) is facing fresh scrutiny amid its £12 billion merger with Walmart’s Asda after more than 100 MPs signed a letter criticising changes to the company’s staff pay, The Times reports. The news comes after the Competition and Markets Authority (CMA) kicked off its probe into the merger which is set to create Britain’s biggest supermarket.
Sainsbury’s share price has advanced in London in today’s session, having added 0.67 percent to 318.31p as of 08:45 BST. The stock is outperforming the broader UK market, with the benchmark FTSE 100 index currently standing 0.12 percent higher at 7,868.95 points. The group’s shares have added some 14 percent to their value over the past year, as compared with a near five-percent rise in the Footsie.
Sainsbury’s-Asda deal scrutiny
The Times reported this morning that more than 100 MPs had signed a letter criticising changes to Sainsbury’s staff pay which threaten to leave some workers more than £3,000 a year worse off. Critics of the retailer’s plans claim that as many as 13,000 of the group’s employees could take a hit to their pay packets under a potential new deal meant to equalise pay among its 130,000-strong workforce.
The newspaper noted that Siobhain McDonagh, a Labour MP, had expressed outrage at the chain’s “unscrupulous contract changes” in a letter to the prime minister.
The news comes with Sainsbury’s already facing a parliamentary inquiry into its tie-up with Asda.
Retailer says claim is misleading
The Times, however, also quoted a spokesman for the blue-chip supermarket as saying that the claim that the changes would result in losses to Sainsbury’s workers of up to £3,000 a year was misleading and that the number of employees in the worst-case bracket was fewer than ten.