Morrisons Staff Face Pay Freeze as Supermarket Blames Government Costs

Morrisons staff are being offered only the statutory minimum wage this year as the UK supermarket giant cites rising government costs as justification for refusing additional pay rises.

The Bradford-based retailer is locked in an escalating dispute with the shopworkers’ union Usdaw, which represents approximately 45,000 Morrisons staff members across the country. The union has accused the company of failing to enter into meaningful negotiations and has registered a formal failure to agree over the 2025 pay talks.

Morrisons Staff Now Minimum Wage Workers

In a development that marks a significant shift for the retailer, Morrisons staff working on basic rates are now classified as minimum wage workers. This represents a considerable departure from the company’s previous position as one of the higher-paying supermarkets in the sector.

The supermarket has refused to offer pay rises beyond the national living wage, currently set at £12.21 per hour for workers aged 21 and over, with a rise to £12.71 planned for April 2026.

Darren Matthews, Usdaw national officer, expressed the union’s disappointment: “It is a sad day when one of the largest retailers in the country is now a national living wage employer, particularly as they were once one of the highest paying of the supermarkets.”

Government Costs Blamed for Pay Stance

Morrisons staff have been informed that the company faces substantial financial pressures stemming from recent government policy changes. The supermarket cited £200 million of unexpected cost increases implemented last April, including changes to national insurance contributions following Chancellor Rachel Reeves’ October 2024 Budget.

The company pointed to several challenges affecting its ability to offer enhanced pay deals, including increased employer national insurance contributions, a lower threshold for these payments, and competitive pressures in the retail sector. Morrisons also highlighted the impact of a cyber-attack on its technology supplier Blue Yonder in late 2024.

A Morrisons spokesperson stated: “Over the last financial year, we’ve invested over £100 million in colleague hourly pay, and with the national living wage rise in April 2026, we will invest a further £70 million.”

Union Criticises Private Equity Ownership

Morrisons staff representatives have questioned whether the pay dispute stems from the company’s ownership structure. Matthews suggested that the situation may be “the result of private equity taking over a family-run business”, referring to the 2021 acquisition of Morrisons by Clayton, Dubilier & Rice.

The union has expressed that Morrisons staff feel “angry, disappointed and frustrated” by the company’s position on pay. Usdaw submitted its original pay claim in November 2024, but the company repeatedly delayed negotiations and has not yet made a formal pay offer.

Next Steps for Morrisons Staff

Usdaw is seeking to move quickly to the next stage of the dispute process, which involves meeting with Acas (Advisory, Conciliation and Arbitration Service), the Government-funded independent body. This meeting will be for conciliation purposes only, using a mediator to attempt to secure an offer, rather than binding arbitration.

Usdaw has called a ballot for next month, asking members to reject the current offer, and the union has indicated that if an agreement cannot be reached, the dispute may lead to industrial action.

For Morrisons staff, the dispute comes at a time of continued cost-of-living pressures. The union continues to call on the company to reverse its position and make a pay offer that recognises both the contributions of staff members and the financial challenges they face.

Industry Context

The situation facing Morrisons staff is not unique in the UK retail sector. The company’s pay now lags behind competitors, with some supermarkets offering rates exceeding £11 per hour. The dispute also comes alongside ongoing equal pay legal challenges at Morrisons and other major UK retailers, including Asda, Tesco, Sainsbury’s and the Co-op.

As negotiations continue, thousands of Morrisons staff await resolution on whether they will receive any pay rise beyond the statutory minimum this year.

Graham Greene

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