LONDON (Reuters) -Britain’s biggest supermarket group Tesco plans to cut about 400 jobs from stores and its head office, seeking efficiency savings so it can invest in the business, it said on Wednesday.

The move follows that of Sainsbury’s, the No. 2 player, which said last week it planned to reduce its headcount by over 3,000 roles.

British companies, and particularly large employers, are facing increased costs this year after the new Labour government’s first budget in October hiked employer social security payments and the national minimum wage.

“We have started speaking to colleagues about a number of proposed changes in our stores and head office, including changing our bakery model in some stores, and updating our management structure in Tesco Mobile phone shops,” Tesco said.

“Taken together, the changes we are proposing mean that around 400 roles will be removed.”

Tesco said it would try and find alternative roles for impacted staff, noting it currently has 1,000 vacancies across the business.

(Reporting by James Davey; Editing by Catarina Demony and William James)