Supermarket giant Asda has been accused of “slash and burn tactics” over plans to cut the pay of 7,000 staff.

The GMB union criticised the company for informing workers at 39 stores they may lose their 60p per hour ‘location supplement’ and have their night supplement reduced.

The union stated employees who do not agree to the changes “will have the new contract imposed on them and could be dismissed if they refuse to sign.”

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These developments coincide with the potential £12 billion merger between Asda and the Issa brothers’ EG Group.

It also follows Asda’s announcement of a 10 percent pay increase for over 115,000 employees at 663 of its stores.

GMB organiser Nadine Houghton told BusinessLive: “Cutting the pay of 7,000 low-paid, retail workers during a cost-of-living crisis is inexcusable.

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“The billionaire Issa brothers and their business partners the multi-millionaire elite private equity fund managers in TDR Capital are restructuring Asda in preparation for the debt-laden merger they are trying to push through with EG Group.

“If the business secretary allows this merger to go ahead, she will be responsible for allowing a deal that is bad for workers, bad for consumers and bad for the high street.

“These slash and burn tactics, along with food and fuel price increases, will only ramp up if the merger goes ahead. TDR and the Issa Brothers will be using Asda’s revenues to pay off their debt mountain – this is money that should be invested in stores, colleagues and ensuring proper competition in pricing.

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“Asda’’s workers and consumers should not bear the brunt of financial engineering from private equity.

In response, an Asda spokesperson clarified that a collective consultation is being held in a small number of stores outside the M25 area.

These stores currently provide a legacy location supplement of 60p per hour on top of the existing £11 per hour rate.

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