John Lewis Partnership employees will receive a 2% bonus for the year to January 31, the first bonus in four years, according to multiple reports. The bonus payment amounts to approximately £35 million in total. The announcement comes as the partnership reported a 6% increase in profits before tax, bonus and exceptional items to £134 million. However, John Lewis posted a pre-tax loss of £21 million, down from a £97 million profit a year earlier. The pre-tax loss was due to exceptional charges including write-downs related to legacy tech systems. Profits were affected by approximately £53 million of additional costs linked to tax changes introduced in April 2024. Higher national insurance contributions cost John Lewis around £40 million, while the Extended Producer Responsibility packaging levy cost £13 million. Sales across the business increased by 5% to £13.4 billion for the year.
John Lewis is cautious in its outlook for the current financial year due to a challenging macroeconomic environment, chairman Jason Tarry said. Tarry said consumer sentiment is 'definitely subdued and definitely fragile'. He added that the business experienced no disruption to supply chains from the conflict in Iran and anticipates no immediate effect on energy expenses due to hedging arrangements. The subdued outlook reflects broader uncertainty in the retail sector, with consumers tightening spending on discretionary items.
You’ve got to get your partners onside and get them excited because people have been through a tough time in that business. The bonus has always been a mark of the John Lewis difference.
John Lewis has told head office staff they must work 'more in person than not', according to multiple reports. The company said many competitors have already implemented a return-to-office policy. John Lewis said the changes to office working would help accelerate its turnaround and achieve better outcomes. The retailer is exploring options to create more space in existing offices for staff to come in more regularly. John Lewis told staff the new office policy does not constitute a change in policy and it remains committed to hybrid working. This marks a shift from the company's previous stance: John Lewis previously championed a blended approach and halved the size of its central London offices in 2023.
Chairman Jason Tarry received a 21% pay rise to £1.2 million and a 2% bonus of £22,700, according to multiple reports. Meanwhile, John Lewis cut 3,300 jobs in the year to January 2026, reducing total jobs from 69,000 to 65,700. The job cuts come as the partnership seeks to streamline operations and reduce costs amid a challenging retail environment.
Things will not get easier going forward.
John Lewis wrote off £22 million on its failed build-to-rent venture, according to multiple reports. The partnership scrapped its rental housing venture in February 2025, citing worsened economic conditions. The write-off reflects the challenges of diversifying into property development amid rising interest rates and construction costs.
According to City AM, a former senior employee described the bonus as a crucial morale booster, saying that getting partners onside is essential after a tough period. According to City AM, Jason Tarry described the outlook as challenging, noting that things will not get easier going forward.
The bonus announcement has been met with mixed reactions. While staff welcome the return of the bonus, some note that it comes after a period of job cuts and cost-saving measures. The partnership employs approximately 65,000 partners, though some reports suggest the figure is over 70,000, reflecting different counting methods. The exact number of head office staff affected by the new in-person working policy remains unclear, as does the specific timeline for implementation. The total remuneration breakdown for Jason Tarry beyond salary and bonus has not been disclosed. The specific economic conditions that led to the cancellation of the build-to-rent venture have not been detailed beyond worsened conditions.