Tesco are set to up their staff's hourly wage to £10.10 an hour.
This salary increase will see its staff and warehouse workers go from £9.55 - a rise of 5.8% which is set to come into force this year.
The retailer, which is the UK’s largest private employer, said the pay increase will come into force from July 24 adding that the new rate of pay is part of a £200 million investment by the company into its workers, which will also include an extension of the colleague discount allowance and new training.
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The move comes after other supermarkets increased their pay with the likes of Sainsbury’s, Morrisons, Lidl and Aldi, all upping their rate to £10 to above.
In addition to this, some staff will receive a bigger increase with the supermarket confirming that customer delivery drivers and click & collect assistants will now receive £11 per hour from July.
Tesco have said that the move "recognises the contribution our colleagues make to our business at a time when household budgets are under pressure.
"Given the uncertainty in the economic environment, this will be a one-year deal, rather than two-year, and we will review pay again with Usdaw (Union of Shop, Distributive and Allied Workers) in 2023."
In addition to a pay increase, the 'Big Four' retailer said it will also increase staff members’ Clubcard discount allowance by £500 to £1,500 for the year as part of investment into the firm’s rewards packages.
Jason Tarry, chief executive of Tesco UK & ROI, said: “We are delighted to have reached an agreement with Usdaw that recognises the vital role our colleagues play in our business now and in the future, giving them a well-deserved pay rise, more access to extra hours and setting out a long-term commitment and investment in their careers at Tesco.
“These investments in our colleagues are central to making Tesco what we truly want it to be: a great place to work for all, a place that attracts and retains the best talent in the industry.”
Daniel Adams, Usdaw national officer, added: “At such a difficult time, Usdaw is pleased to have secured a pay deal that not only delivers the highest hourly rate of pay in the sector but also delivers on the union’s New Deal for Workers campaign, giving our members the right to request a “normal hours” contract and ensuring a minimum 16-hour contract going forward.
“The pay deal is testament to the hard work of Usdaw members within Tesco throughout the last 12 months and the commitment and dedication of our reps who were involved in negotiating the deal.”
