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Almost 10,000 Asda workers have received incorrect payslips following a botched IT update being overseen by co-owner Mohsin Issa.
In an internal memo sent to senior staff, the supermarket said thousands of hourly paid workers’ pay had been affected by the glitch, with union bosses saying some had been underpaid.
One Asda worker reported that as much as two weeks’ worth of wages had been deducted from some employees’ payslips for March.
The payroll chaos represents the first major disruption for staff as Asda’s owners, the billionaire Issa brothers and private equity firm TDR Capital, attempt to disentangle IT systems from former owner Walmart.
Dubbed internally “Project Future”, the IT transition was put to the test for the first time this week as Asda bosses rolled out a new form of payment software.
In a letter to store managers on Thursday, Asda bosses said: “During our payroll checks, we have currently identified around 9,500 hourly paid colleagues who are impacted by incorrect pay, due to what we believe is an issue with a specific holiday calculation as we have moved to our new systems.
“Colleagues’ payslips may not show correctly so please reassure colleagues that we are aware of this and are making the relevant adjustments to ensure that colleagues receive payment by Friday payday.”
The supermarket has since pledged to pay workers what they received in February to make up for any shortfall in wages.
However, GMB, the union which represents Asda workers, said some employees were still underpaid as a result of the botched update.
One Asda employee said: “There’s a lot of upset colleagues around. It is a shambles.”
A spokesman for the GMB union said: “GMB has been made aware of numerous and significant issues relating to our members’ pay being incorrect and underpaid as a result of the change in Asda’s pay and people systems this payday.
“Being underpaid can cause huge levels of stress and anxiety, particularly as the majority of Asda’s workers are low-paid.
“We hope Asda can resolve this issue quickly for the workers who keep Asda’s stores running day after day.”
It is not yet clear when the problem affecting Asda’s payroll system will be fixed.
However, the broader attempt to extricate Asda’s IT systems from former owner Walmart is still ongoing three years after the Issa brothers bought the supermarket for £6.8bn.
Setbacks to the project have meant Asda is still having to pay the US retailer for using the systems, although bosses are hopeful that a handover will be complete before the end of 2024.
Mohsin, who is running Asda’s day-to-day operations, has set the IT transition as one of his main goals, with sources indicating that he will not step aside until it’s complete.
Last month, he said he was “getting to a point” where he could hand over the reins, although industry sources have warned that Asda will struggle to find a replacement while Mohsin is still involved.
The payroll problems will increase scrutiny on Asda at a time when the retailer’s owners have been thrust into the spotlight.
The Telegraph revealed earlier this year that Zuber Issa, Mohsin’s brother, is attempting to offload his 22.5pc stake in Asda as he seeks to focus solely on EG Group’s petrol stations empire.
The potential ownership change came after EY quit as Asda’s auditor, which coincided with Mohsin starting a relationship with one of the Big Four firm’s former partners.
Meanwhile, the supermarket is battling to win back shoppers amid mounting debt pressures.
The supermarket currently has around £4.2bn of debt, which has led to hundreds of millions of pounds of interest costs.
Pressure on costs has sparked discontent among many store managers given a drop in hours among staff, which led to bosses trialling a four-day week to quell a revolt.
An Asda spokesman said: “We recently launched a new HR system and conducted pre-emptive checks to identify any potential issues before colleagues were paid this month.
“These checks found a potential problem with holiday pay that could have resulted in a pay discrepancy for some hourly paid colleagues. We have taken immediate and proactive steps to correct this – to help ensure there will be no shortfall in pay for these colleagues this month. Project Future will give Asda a world-class IT platform.”