Tesco to increase store worker pay by 7%

The rise – its third increase over the past 10 months - will represent an investment of more than £230 million, bringing total pay investment to a record £450 million over the past year after previous increases.

The retailer said the new minimum pay rate for store workers, which followed discussions with the Usdaw union, will take place from April 2 to “reflect the increasing costs our colleagues are currently facing”.

As part of the pay deal, Tesco will also increase its “additional skills payment” for shift leaders by an extra 40p to £2.26, bringing their hourly rate to £13.28

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Jason Tarry, Tesco UK & ROI CEO, said: “For the second year in a row, we have made a record single-year investment in base pay for our colleagues.

“We know that many colleagues have felt the pressure of rising costs this year, and we are absolutely committed to supporting them with competitive base pay and exclusive colleague benefits.

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“This agreement recognises the incredible work and dedication our teams show every day in serving our customers.”

It comes a week after Asda announced a 10% pay increase for its hourly-paid store workers from July.

Supermarkets across the UK have been engaged in a tussle for staff as labour shortages persist and the cost of living increases.

Tesco said its latest pay increase accompanies new benefits brought in recent months, like free food for staff in store canteens, a salary advance scheme and a discount of up to £1,500 a year off shopping.

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Daniel Adams, Usdaw national officer, said: “This deal, which follows earlier agreements with Usdaw on additional investment outside of the normal annual negotiations and bringing the 2023 pay negotiations forward, represents a significant step forward for pay within Tesco retail.

“It represents a third increase in pay in 10 months and ensures that the business continues to respond positively to the significant pressures our members face.”