James Davey

LONDON (Reuters – Sainsbury’s shareholders will have the opportunity to vote next month on a resolution calling for Britain’s 2nd largest supermarket to make a commitment to its employees to pay the “real living wage” by July 2023.

Responsible investment group ShareAction, which co-ordinated the filing of the resolution in March by an investor coalition that includes Legal & General and Nest, said on Monday negotiations with Sainsbury’s had reached an impasse and the resolution would definitely go to a vote at the July 7 meeting.

ShareAction stated that the first shareholder resolution for a living wage at a British firm “will serve as a test of investors’ Environment, Social and Governance commitments to workers in a spiraling cost-of-living crisis.”

According to the amount of work that workers need, the Living Wage Foundation charity established the real living wage. The Resolution Foundation independently calculated the actual living wage.

The current rates for hourly work in London are 11.05 pounds (13.92%) and in the United Kingdom, 9.90 pounds each hour. Compare this to Britain’s minimum wage of 9.50 Pounds an hour.

Over 10,000 companies, including Google (NASDAQ : ), have signed up for the living wage.

As it assesses the risks that inflation’s recent rise to an all-time high of 9% (a 40 year record), the Bank of England will be closely monitoring pay agreements.

ShareAction admitted that Sainsbury’s had been paying real wages since May to all of its employees, but not for any third party contractors like cleaners and security staff.

ShareAction stated that “Most important, it has not made any ongoing commitment to match real living wages in the future.”

This is particularly important because, given current inflation rates, they will likely rise dramatically when they are recalculated in September.”

Sainsbury’s spokesperson stated that the company was the first to pay its employees the living wage. The majority of contractors received at least the living wage.

“To effectively balance the needs of our customers, colleagues, suppliers and shareholders we must preserve the right to make independent business decisions which are not determined by a separate body,” the spokesperson said.

Sainsbury’s suggests that shareholders vote no on the resolution. It employs 189,000 people, which makes it the largest private employer in Britain.

($1 = 0.7939 pounds)