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Tesco has reached an agreement with trade union USDAW that will increase the hourly pay rate for staff in stores, from £12.02 to £12.45 from 30 March 2025, and again to £12.64 from the end of August.
This two-stage rate increase represents an above-inflation increase of 5.2% builds on the significant investment Tesco has made in colleague pay and benefits in recent years.
Furthermore, the London allowance will increase to £1.21, up 7.1%, taking rates from £13.15 per hour to £14.36 per hour. It also announced that it would be increasing the maximum company sick pay entitlement to 20 weeks for eligible colleagues.
However, the supermarket did announce that it will be removing Sunday premium payments, with eligible colleagues receiving a one-off payment. Bank Holiday premiums will be retained.
This latest £180m investment in colleague pay will mean hourly-paid colleagues will have seen a pay increase of 32% since April 2022, equivalent to a more than £900m investment.
Matthew Barnes, Tesco UK CEO, said: “Our colleagues are our greatest asset, and this pay deal recognises the brilliant work they put in day-in, day-out to serve our customers. It also represents another significant investment in our colleague pay, which combined with our fantastic package of benefits, means Tesco continues to be a place to get on and thrive in a fulfilling and rewarding career.”
Daniel Adams, USDAW National Officer, added: “It is a real achievement that USDAW reps have been able to secure an above-inflation pay deal that builds on the negotiations of the last few years.
“Not only does it ensure a meaningful gap between the Tesco rates of pay and the National Living Wage in April, but it also means that in August, the basic rate of pay in Tesco will exceed the Real Living Wage rate outside of London and meet it within the M25. This, along with the other negotiated improvements, demonstrates the value of a modern and progressive relationship between independent trade unions and employers.”
