Tesco share price: Supermarket lifts basic pay above National Living Wage

Tesco (LON:TSCO) has raised its hourly pay above the new National Living Wage threshold. Britain’s largest supermarket group said in a statement this afternoon that it would give its UK store staff a 3.1 percent pay increase, taking the hourly rate to £7.62. The change means that Tesco’s “established colleagues” will be awarded “significantly more” than the £7.20 minimum, which will come into effect in April.

As part of the deal agreed with the Union of Shop, Distributive and Allied Workers (Usdaw), Tesco also introduced a “simpler and fairer” approach to premium payments, meaning all staff will receive time and a half for Sunday and bank holiday shifts from July. Pay for Sundays and Bank Holidays, late nights and overtime hours will be trimmed heavily to help pay for the increases elsewhere. Staff who used to receive double time for Sundays and Bank Holidays will now be paid time-and-a-half from July 3. Any staff negatively impacted by the changes would be given a lump sum transition payment worth 18 months of the difference in pay, Tesco pledged.

Matt Davies, Tesco’s CEO for the UK and Ireland, said: “We’ve spent a lot of time working with Usdaw and colleague representatives to understand what’s important to colleagues. Together, we’ve agreed one of the highest pay and benefits packages in retail for store colleagues, and introduced a simpler and fairer pay structure, including one approach to premium payments.”
Tesco’s share price has dipped today, mirroring the broader UK stock market trend. As of 14:46 GMT, the grocer stood three percent lower at 166.60p, while the FTSE 100 was 2.55 percent lower at 5,905.58 points.
As of 15:06 GMT, Tuesday, 02 February, Tesco PLC share price is 166.45p.