Around 280,000 Tesco workers will be able to get up to 25% of their contractual pay early under a scheme set up to help them with unexpected or large expenses, the supermarket announced last week (November 18).
Teams working in Tesco pharmacies are among those eligible for the scheme, a spokesperson confirmed to C+D today (November 22).
Read more: Cost-of-living crisis: How are pharmacies supporting their staff?
Employees will pay a fee of £1.49 to access each advance, which Tesco hopes can help them “avoid having to take on expensive debt with high interest payments, such as pay-day loans”.
Staff can ask for an agreed percentage of their earnings, which they will receive within 24 hours but could arrive in their account within minutes, Tesco said.
“The amount will be automatically repaid at the next pay day, and they will be allowed to take one advance per pay period,” it clarified.
The scheme was initially piloted with more than 6,000 of the supermarket’s employees in Liverpool, where 51% said they used it “to deal with an unexpected expense”.
The company Salary Finance manages the scheme and receives the fee for each salary advance, Tesco specified.
Read more: Online pharmacy Chemist4U set to give employees £750 cost-of-living bonus
Tesco UK People director James Goodman said: “We know that colleagues can face unexpected bills, such as car repairs or replacing a washing machine, which can leave them short.
“To give them a helping hand with their financial wellbeing, we have launched pay advance to give them a simple and low-cost way to access some of the money that they have already earned. We hope this helps to support colleagues, particularly in the run up to Christmas.”
PDA: “Positive option” that reflects of cost-of-living crisis
Pharmacists’ Defence Association (PDA) director Paul Day told C+D that while the concept of pay advances is not new, not all employers would consider supporting their staff in this way.
“That Tesco have arranged this facility as an alternative to avoid desperate employees seeking a pay-day loan or other high interest debt is a positive option for one-off, unexpected emergency calls on household finances,” Mr Day conceded.
However, the fact that the supermarket chain has launched this initiative “is a worrying reflection of the cost-of-living crisis impacting the UK”, he added.
“Ultimately, everyone needs to be paid enough to support their month-to-month expenditure,” Mr Day stressed.
Pharmacists borrowing money to help with pressures on their household income and expenditure need to consider “how they are going to survive the next month with only the remaining portion of their regular salary payment coming to them”, he pointed out.
