Tesco has reached an agreement with trade union USDAW that will increase the hourly pay rate for colleagues 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% and builds on the significant investment Tesco has made in colleague pay and benefits in recent years.
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.
As part of this pay deal for colleagues, Tesco will also be making the following changes:
- The London allowance will increase to £1.21, up 7.1%, taking rates from £13.15 per hour to £14.36 per hour.
- To bring Tesco in line with other retailers, it will be removing Sunday premium payments, with eligible colleagues receiving a one-off payment. Bank Holiday premiums will be retained.
- Providing Colleague Clubcard discount with no cap for colleagues and their second Clubcard holder, replacing the previous £2,000 allowance.
- Increasing the maximum company sick pay entitlement to 20 weeks for eligible colleagues.
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.”
