Tesco gives below-inflation wage rise to shop workers

7th Apr 2022 15:30

(Sharecast News) - Tesco announced a 55p-per-hour pay rise for its supermarket staff on Thursday, bringing the UK's largest private employer into line with its discounter competitors in terms of pay.

The FTSE 100 retail giant said staff would be paid £10.10 per hour from 24 July, up from £9.55 per hour currently.

Its London staff would receive a similarly-scaled pay rise to £10.78 per hour, while delivery drivers and click-and-collect workers would be bumped to £11 per hour for their time.

Tesco said it will also increase the discount it gives employees on its 'colleague Clubcard' to £1,500 per year, from the previous £1,000.

But the 5.76% pay rise for Tesco workers will still result in a real-terms fall in wages amid surging inflation, with the latest retail price index rising 8.2% and the consumer price index up 6.2%.

The deal brings Tesco's hourly wage up to the levels of the limited-assortment discounters Aldi and Lidl, which both became the highest-paying supermarkets in the UK earlier this year.

It also sees Tesco join two of its 'big four' competitors in paying at least £10 per hour, with Morrisons hiking wages in April last year and Sainsbury's joining in January.

Asda, meanwhile, is raising wages to £9.66 per hour from April - a move strongly criticised by the GMB union, which said the supermarket's own employees were becoming unable to afford the food they were selling.

The supermarket chain was taken over by billionaire garage operator brothers Moshin and Zuber Issa in 2020 in a £6.8bn deal.

Industrial relations were strained under previous owner Walmart, which in 2019 threatened to sack 12,000 employees if they did not sign new contracts.

Those new contracts offered a wage rise to £9 per hour, but removed paid meal breaks, cut bank holiday premiums and reduced the availability of higher-paid night shifts.