Tesco’s new boss Dave Lewis receives bumper pay package of £4.1m in first six months
- Credit: PA
Tesco paid £4.1 million to new boss Dave Lewis in his first six months after he was brought in from consumer goods group Unilever to turn around the embattled supermarket.
The group’s annual report also said it handed a £1.2 million pay-off to former boss Philip Clarke - on top of £764,000 in salary until mid-January - but confirmed it plans to claw back the leaving payment if it finds there was gross misconduct following the discovery of an accounting black hole.
Tesco’s report showed further perks for Mr Clarke, who can still cash in £1.14 million of long-term incentive share awards and will retain his staff discount for life.
Mr Lewis took charge last September following a series of profit warnings culminating in the departure of predecessor Mr Clarke.
After Mr Clarke left, Tesco discovered a £263 million overstatement of expected profits in the first half of its financial year and its shares hit a 14-year low following the revelation.
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Annual figures last month showed Tesco suffered one of the biggest losses in corporate history as it reported a staggering £6.4 billion loss and warned of a tough challenge to return to profit growth this year.
Mr Clarke was given the leaving pay-off in February despite the financial woes, while former finance director Laurie McIlwee was also paid around £1 million on leaving in addition to salary payments.
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Tesco said in its annual report: “Should it be determined in the future that there was gross misconduct the company will seek recovery of the termination payment.”
The Serious Fraud Office (SFO) is investigating the accounting black hole discovered in Tesco’s accounts.
Mr Lewis’s bumper pay package for the five months to the end of February included £3.3 million in lieu of incentive awards he gave up on leaving Unilever.
His pay deal at Tesco sees him earn a package worth up to £8.1 million a year, comprising £1.25 million in annual salary, plus a potential £3.13 million bonus, possible £3.4 million in long-term incentive shares and £313,000 in pension.
The group said no directors received a bonus for the year to the end of February and that bosses’ salaries would not be increased in 2015.