Tesco Ireland: Sharing our success with staff
Tesco is Ireland’s leading food retailer serving over 1 million customers weekly from 107 stores throughout Ireland and employing over 13,000 people. We are committed to delivering low prices, value, choice, range and service. In addition, we are also proud supporters of the Irish food industry and last year alone Tesco bought €65 million worth of Irish food and drink exports, ranking Tesco ahead of France, Germany, Italy, Netherlands and the USA.
To ensure we reward our employees for their loyalty, enthusiasm and commitment in making Tesco Ireland the largest and best retailer, we wanted to provide staff with an opportunity to share in the success of the company by providing share options at a discounted rate.
- Save As You Earn (SAYE) offers Tesco staff the option to buy Tesco shares at a discounted rate.
- Staff choose the amount they want to save between €12 – €80 every four weeks.
- Staff also choose how long they wish to save for: 3 or 5 years.
- The share price is set at the beginning of the savings period and is discounted. This price then becomes the final purchase price, which means staff can buy shares after 3 or 5 years at the original price set, hopefully leading to a profit!
- Amount chosen is deducted from pay after tax and held in a savings account.
- At the end of the savings contract, a guaranteed tax-free bonus is added to the savings.
- Staff can then choose to buy Tesco shares at a discount (price set at start of the contract) or take a lump sum.
- The scheme is launched annually to all eligible employees. Packs are sent to home addresses and there is a communications campaign with posters, table tops and briefing sessions throughout the business.
- Over 4,000 Tesco Ireland staff participate in the share schemes.
- Employee loyalty has increased as employees feel more involved in the company and its success.
- Feedback from the success of the scheme has been very positive with participation increasing each year. According to Katrina O’Connell, Reward Manager, “Thousands of employees have financially benefited over the past eight years and we have now developed a strong culture around SAYE, with employees anxious for the next scheme launch”.
- “By saving €80 a month for the last 5 years, my total cash return, including bonus top up, was €11,000 – it was painless!” – Employee Shareholder.
- “I take an active interest in the performance of the company because I know if the company does well, I stand to gain”. – Employee Shareholder
Ensure employee participation rates continue to increase and the scheme remains a success.
- Application process needs to be straightforward.
- Encourage participants to market the scheme through their own personal experiences and success stories – use examples of previous SAYE successes to market the scheme.
Reward & Benefits team and Personnel Managers in stores/office and distribution centres.
Katrina O’Connell, Reward Manager, firstname.lastname@example.org