XPO boss accused of receiving multi million pound bonus while receiving millions of UK furlough cash
- Monday 10 May 2021
Unions representing workers at XPO Logistics are calling for a full investigation after it emerged the American chief executive of the company received an incentive award of up to $80 million (£57 million), while the company is estimated to have received more than £100 million from the UK government in furlough payments.
The pandemic bonus payment to Bradley Jacobs, XPO chief executive, comes amid growing scrutiny of paying senior managers large bonus and dividend payments while their companies are receiving government support.
XPO employs more than 25,000 workers in the UK and carries out transport and logistics work for many of the leading supermarkets including Morrisons, Co-op, Waitrose and Iceland.
Unlike the chief executive, XPO staff, who have risked their health and that of their families by continuing to work throughout the pandemic, will not receive any form of Covid-19 pandemic bonus, despite the unions Unite and GMB, lobbying for such a payment to be made.
XPO has also refused to make up the pay of the wages of workers who have been furloughed, who are only receiving the basic 80 per cent government rate.
Analysis of the government figures of furlough payments revealed that XPO claimed at least £3.28 million in December 2020 and up to £10.5 million in February 2021. If this figure is averaged over the entire period of the scheme to date then XPO will have received more than £100 million in furlough payments. XPO may also have received millions of pounds in taxpayer-funded business rates relief.
Despite claiming millions in furlough payments, XPO last year recorded $16.5 billion in revenue with a record breaking second half of the year. In July 2020 Jacobs received a long term cash award of up to $80 million and an annual bonus of $3.3 million for his handling of the Covid pandemic.
Kick in the teeth
Unite national officer Matt Draper said:“The bonuses given to the chief executive are a complete kick in the teeth for the XPO workers who have risked their health to keep the company operating throughout the pandemic.
“There is clearly one rule for the bosses and another for the workers on the frontline who have been denied any kind of bonus. What makes this even more sickening is that UK taxpayers' money appears to have gone straight into the pockets of the company’s American chief executive.”
GMB National Office Mick Rix said: "XPO spend on executive pay is nothing short of greed - especially when you contrast how slow XPO was to enact UK government guidance for employers on social distancing and other requirements at the start of the pandemic.
"At one stage, XPO encouraged workers to share freezer suits at its Morrisons supermarket site in Scotland - until GMB stepped in.
"It’s time the XPO workforce was treated with respect and given a share in the vast company profits that they help contribute to."
XPO is due to spin off the logistics arms of its business under the new name GXO, which will be headquartered in London. The new company GXO, will look to quickly expand by continuing XPO’s strategy of mergers, acquisitions and takeovers.
The company is already extending its contract with online retailer ASOS and has secured a five year contract with the UK government to store goods and vehicles for the UK Border Force. Jacobs is set to profit from such a move, as he will own 17 per cent of both companies. The details have been disclosed ahead of the company’s AGM which will be held on Tuesday 11 May online.
This is not the first time that concerns have been raised about XPO’s business practices. In October 2020, a global group of unions released a report on XPO detailing allegations of wage theft through misclassification and subcontracting chains of exploitation, as well as serious health and safety breaches, discrimination and sexual harassment.
International Transport Workers’ Federation Inland Transport Section Secretary. Noel Coard said: “XPO is a bad operator globally. The company’s health and safety record, especially in terms of its Covid response, has been such that you would expect the CEO to be penalised, not rewarded.”
Covid safety breaches
Both Unite and GMB have both raised serious concerns about the company’s response to COVID-19, especially in its warehousing facilities. In March 2020 the XPO-run ASOS warehouse in Barnsley was dubbed ‘a cradle of disease’ by the GMB union, where working conditions had previously been likened to that of a ‘satanic mill’.
In June 2020 an Iceland facility in Swindon run by XPO had an outbreak of COVID in which 70 employees tested positive. Unite said employees were fearful of returning to work and criticised XPO for not quarantining the site to protect workers.
Ahead of the company’s AGM tomorrow, UK unions are calling on XPO Logistics’ shareholders and customers, including the UK government and major supermarkets, to work with unions to ensure that the company values its workers, compensates them fairly and respects international labour standards.
Note to Editors
UK HMRC figures on claims made by all companies under the UK government Coronavirus Job Retention Scheme (‘the scheme’) have been published in full for the months of December 2020 to February 2021. This public data reveals claims made by a number of companies under the ownership of XPO Logistics. XPO Logistics Drinks Limited, which changed ownership from Kuehne and Nagel in January 2021 is also included in our calculations as a beneficiary of the scheme.
The lowest known potential amount claimed, from figures published December 2020, and the highest known potential claimed, from figures published February 2021, have been used to calculate an average monthly claim over the entire period of the scheme. XPO claimed at least £3.28 million in December 2020 and up to £10.5 million in February 2021. If this figure is averaged over the entire period of the scheme to date then XPO will have received more than £100 million in furlough payments. XPO may also have received millions of pounds in taxpayer-funded business rates relief.
As the figures published relate only to claims made in later stages of the pandemic, we estimate that the actual total amount claimed may likely be much higher. UK unions are aware that XPO has been furloughing staff since the beginning of the crisis.
For media enquiries ONLY please contact Unite senior communications officer Barckley Sumner on 07802 329235 or 0203 371 2067.
Email: [email protected]