The John Lewis Partnership has announced it will share £35 million with its workforce after a year of improved underlying performance. The 2% bonus represents roughly one extra week of pay for each of the group’s 69,000 employees. This marks the end of a four-year hiatus for the payout, a period marked by significant restructuring and economic uncertainty.
The history of the John Lewis bonus is a storied one, dating back to the mid-20th century. However, the last decade has seen the payout dwindle to single digits before disappearing entirely during the pandemic. The decision to bring it back now follows a year where sales rose 5%, even as the company navigated what management described as a “subdued” retail environment.
Underlying profits for the year reached £134 million, though the statutory pre-tax result was a loss of £21 million. This discrepancy was largely due to non-recurring costs, such as the depreciation of old technology and a significant increase in tax obligations. Analysts noted that while the results were slightly below some market expectations, the cash growth was a positive signal.
The company is currently executing a multiyear plan to revitalize its brands and improve efficiency. This has involved difficult decisions, including the closure of dozens of outlets and thousands of head office redundancies. The chair, Jason Tarry, remains optimistic, stating that record customer satisfaction levels suggest the long-term investment strategy is beginning to pay off.
Future growth plans involve a “back to basics” approach for the retailer. The partnership has scrapped previous plans to become a major residential landlord, choosing instead to reinvest £800 million into its stores. With new brands like Topshop entering their aisles, the group is betting on a retail-focused future to drive higher partner dividends in the future.