Tesco awards staff biggest pay rise in a decade

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Tesco has revealed plans for significant investment in its workers, which will involve increasing hourly pay rates for store and warehouse staff by 5.8%.

Tesco store worker

Tesco will increase base pay for store and customer fufilment centre workers from £9.55 an hour to £10.10, a move that will come into effect from July 24.

This increase will represent a £200m investment in employees and also marks a 40% rise in hourly pay over the past 10 years, according to the grocer. It is also the biggest pay rise for Tesco employees in at least a decade.

For customer delivery drivers and click-and-collect delivery assistants, the skills payment will rise by 90p an hour from May 1, bringing the hourly rate to £11 for these employees from July 24.

The pay increases follow negotiations with trade union Usdaw.

Tesco will also increase the Colleague Clubcard discount allowance by £500, bringing the annual discount to £1,500 from this month. This will allow employees to benefit from a 10% discount per shop, rising to 15% on payday weekends.

All new contracts will be based on a minimum of 16 hours per week, while employees will now also be able to work across new departments if required by the store.

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The business will also invest in learning and development opportunities following employee feedback “to equip colleagues with future-fit skills to help them continue to build long-term careers”.

To achieve this, Tesco will launch an online platform later this year displaying schedules and opportunities to access training programmes or sign up for extra hours.

UK and Ireland chief executive Jason Tarry 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.”

Usdaw national officer Daniel Adams 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.”