A CITY councillor has branded a popular cafe chain "mean and unfair" for ending free lunches for staff because of the Government's new national living wage.

Tom Hayes, who represents St Clement's, criticised Caffe Nero after it ended the perk for employees while continuing to make millions of pounds in profit last year.

The firm has three branches in central Oxford – in High Street, Gloucester Green and Blackwells – and one in Headington.

But in a letter shared with the Oxford Mail, Mr Hayes said staff were entitled to a free lunch because they "helped to generate profits".

Caffe Nero told its employees earlier this year that the new wage rate – £7.20 an hour for those aged 25 or over – would have "a significant financial impact" on its business.

It said it needed to find ways to save cash, asking staff to cough up 35 per cent of the cost of lunch time paninis.

This was despite the company not paying corporation tax since 2007 and making profits of £23.6m in the 2014/15 tax year, prompting Mr Hayes to call on the firm to pay its "fair share".

Writing to Caffe Nero chief executive Gerry Ford, the city councillor said: "I am writing to express my deepest disappointment that Caffe Nero has decided to fund the introduction of the [National] Living Wage by cutting back perks for their hard-working staff.

"Yet it is reported that Caffe Nero made a before-tax profit of £23.6m in the year 2014/15.

"Clearly, your chain's staff have helped Caffe Nero to generate such profits.

"But non-payment of its duties would also play a role. When corporations and businesses don't pay their fair share of taxes in a country where they do business, the Government is robbed of the money it needs to run public services that everyone can depend on.

"The decision to make your staff pay for their own wage increases by taking away their free lunches has struck me and many others across Oxford as mean and unfair on your staff."

He urged the company to reinstate free lunches and called on the firm to pay corporation tax.

The comments come after several major firms came under fire for their response to the living wage introduction, with many cutting staff benefits to pay for it.

Caffe Nero has justified its decision by saying it would pay all staff the new rate, not just those aged 25 or over.

A spokeswoman told BuzzFeed News: "The majority will be receiving a pay increase depending on their role or situation. Much of this is above and beyond the minimal wage requirements and emphasises our commitment to our hard working, and dedicated baristas."