WOOLWORTHS South Africa (WSA) has committed to investing an extra R120 million in wages over the next three years, and has approved a 4.5 percent increase for South African store staff, according to the Woolworths (Woolies) 2021 annual report released yesterday.
According to the annual report, the WSA base pay last year was 47 percent higher than the South African minimum wage rate and 13 percent above that of the retail sector. The legislated minimum wage is currently R21.69 an hour.
“To further accelerate the improvement in the lives of WSA store-based employees, we will invest an additional R120 million over a three-year period to adjust WSA’s hourly base pay from R33.40 to R41.25 in 2023 – a 23.5 percent increase.
’’This investment will bring a meaningful benefit to the more than 20 000 store staff and go a long way towards our ‘just wage’ aspirations,” said the group.
The group said it introduced a ’’just wage’’ in 2019, a wage which would recognise the critical need to close the remuneration gap in the context of the socio-economic environment in South Africa.
Woolies said executive directors and management levels did not receive a guaranteed pay increase in 2021, and it has approved a 4.5 percent increase for South Africa store staff and 2 percent for Australia for the 2022 financial year.
“In South Africa, we have maintained the principle that store staff are given an increase higher than management levels. Non-executive directors’ fees are proposed to increase by 4.25 percent for South Africa and CPI-related increases for Australian and UK based directors,” said the group.
The group said it paid chief executive officer (CEO) Roy Bagattini, chief financial officer Reeza Isaacs, chief operating officer Sam Ngumeni and South African chief executive Zyda Rylands a combined R95 million remuneration based on the performance of the financial year including the vesting of shares.
Total guaranteed pay for the executives was R42m, including R9.4million for Rylands who stepped down after six years as the South African chief executive, R7.8m for Ngumeni, R6.6m for Isaacs and R11.5m for Bagattini.
Bagattini was appointed as group CEO in February 2020 and his remuneration is paid in rands and Australian dollars to reflect the time and focus spent in the different geographies.
His pay also included pay and R10.6m in short term incentives.
Woolies was under fire from shareholders during its 2020 AGM for certain aspects of its remuneration payments in 2020 leading to a disappointing approval of only 18 percent for the Implementation Report.
“We understand their concerns and believe that they largely related to the exit package of the outgoing CEO (circumstances which are not anticipated to be repeated), the request for further disclosure of performance measures attributable to the sign-on Restricted Share Plan (RSP) award made to Roy Bagattini, and details of the inclusion of a strategic component in the Corporate Short Term Incentive bonus scheme,” said the group.
Bagattini was granted over 1.4 million shares under the group’s RSP. According to reports the shares were granted at a weighted average price of R37.8699 per share, with a total transaction value of R54.25 million.
For the full year, group sales increased by 9.7 percent to R85.9bn, adjusted profit before tax was up 110.7 percent to R4.6bn and headline earnings per share (Heps) increased by 212.5 percent to 374.4 cents per share.
BUSINESS REPORT ONLINE