Staff revolt at WH Smith

WH Smith shopworkers have inundated chief executive Kate Swann with complaints about her decision to slash staff discounts.

According to insiders, Swann's move to halve the discounts from 25% to 12.5% to reduce costs has sparked an unprecedented backlash in the company.

'Morale was pretty bad to start with,' said one insider. 'Now it has hit rock bottom. Everyone has been writing furious letters, but we are being ignored.'

The move to cut the discount came at a particularly sensitive time for the troubled group. It has been suffering from fierce competition from supermarkets, which have made inroads into Smith's traditional sales by selling cut-price CDs, books and stationery.

It also coincided with the announcement of a lucrative incentive scheme for the company's top managers.

It could bring Swann a gain of almost £4m if the retailer does well.

The scheme, which will also earn 40 top managers a slice of about £20m in shares in three years' time, was approved by shareholders at the end of last month.

The reduced staff discount is one of a range of measures introduced by Swann to turn WH Smith around.

She has also cut head office costs dramatically, revamped the store displays and selling space and brought in new senior staff.

However, trading is still said to be tough and there are concerns that trading has in fact worsened ahead of full-year results due on October 14.

WH Smith refused to comment.