The UK arm of German discount supermarket Lidl will give its 28,000 hourly pay workers a pay rise of at least 2.8% it said on Monday.
This is slightly above the current inflation rate of 2.5%.
The Bank of England is keeping a close eye on wage settlements as it assesses further moves in interest rates after cutting a quarter-point last week.
The new pay rates come ahead of the UK government’s 6.7% hike in the national minimum wage to £12.21 for most adult workers, which will kick in from April.
Lidl GB said entry-level pay will rise to £12.75 per hour nationally – from £12.40 – from March.
This will increase to £13.65, depending on the length of service.
London pay rates will start at £14, increasing to £14.35 over time.
The pay increases will cost Britain’s sixth-largest grocer almost £15 million, it said.
Lidl GB’s raises follow moves by number-two retailer Sainsbury’s and number-three Aldi.
From March, Sainsbury’s will switch to a minimum of £12.45 per hour, while Aldi will pay at least £12.71.
The UK’s job market showed further signs of cooling at the start of the year as demand for staff fell by the most since mid-2020, according to a survey published on Monday that suggested the Labour government’s payroll tax hike and economic uncertainty were weighing on hiring.
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