TENS of thousands of supermarket workers will see their pay go up by 5% this year despite a government tax raid on businesses.
Sainsbury’s has said it will bump up the salaries of its hourly-paid members of staff in two separate rises.
Hourly pay will be hiked from £12 currently to £12.45 in March and then to £12.60 per hour in August.
Workers based in London will see their pay packets hiked from £13.15 to £13.70 then £13.85.
The pay boost comes after Sainsbury’s cheered its “biggest ever” Christmas period, with grocery sales up 4.1% in the 16 weeks to January 4.
Overall group sales, not counting fuel, were also up 2.7% across the same time period.
But the announcement of the pay rise also comes after Sainsbury’s warned of raising prices for shoppers after the Government’s Autumn Budget tax raid on businesses.
Simon Roberts, chief executive of J Sainsbury’s PLC, said: “We are pleased to announce that we will raise pay for our hourly-paid colleagues by 5% in the year ahead, split into two separate increases to help manage a particularly tough cost inflation environment.
“We believe in rewarding our colleagues well for delivering leading service and productivity and we will be the best paying UK grocer from March.”
Sainsbury’s said the two pay rises for 118,000 members of staff will take the total salary for a full time colleague outside London from £22,882 to £24,026.
By August, pay for hourly-paid workers will have been hiked by 58% since 2018, Sainsbury’s said.
The pay boost will also see workers’ salaries match the Real Living Wage, a voluntary wage offered by thousands of businesses.
[bc_video account_id=”5067014667001″ application_id=”” aspect_ratio=”16:9″ autoplay=”” caption=”SAVE AT SAINSBURY’S” embed=”in-page” experience_id=”” height=”100%” language_detection=”” max_height=”360px” max_width=”640px” min_width=”0px” mute=”” padding_top=”56%” picture_in_picture=”” player_id=”default” playlist_id=”” playsinline=”” sizing=”responsive” video_id=”6360946241112″ video_ids=”” width=”640px”]The latest news from Sainsbury’s, which means by March they will pay store assistants more than Aldi, comes despite the retailer warning of price rises for shoppers following the Government’s Autumn Budget.
Bank of England deputy governor Sarah Breeden also warned yesterday the hikes could lead to lower wages for staff in the “long run”.
Mr Roberts told The Sun in November the supermarket was facing a £140million hit from the hike to employer National Insurance contributions (NICs) in April.
Currently, businesses pay employer NICs at 13.8% on salaries of £9,100 and above.
But this rate will be hiked to 15% and the threshold at which they are paid lowered to £5,000 from April 6.
Mr Roberts said in November: “It will lead to inflation and it’s pretty clear it’s going to come pretty fast.
“Given the low margins of the industry, there isn’t the capacity to absorb this level of unexpected cost inflation.”
Sainsbury’s is one of a number of retailers and businesses that have warned the upcoming hike to NICs, as well as the rise in the minimum wage, will force them to rise prices for customers.
[authenticated-scripts src=”%3Cscript%20class%3D%22palin-poll%22%20src%3D%22https%3A%2F%2Fwww.thesun.co.uk%2Fpollingwidgets%2Fv3%2Fwidget.js%3Fquestion_id%3D102278%26game%3Dpolling%22%3E%3C%2Fscript%3E” type=”embedded” width=”100″ /]The British Retail Consortium (BRC), which represents retailers, suggested earlier this week food prices will go up an average of 4.2% later this year.
Posh chain M&S also cautioned shoppers could see prices rise across its branches.
Boss Stuart Machin said it would pass costs on “as little as possible” but had been forced to tweak its business plan for the coming years.
Fashion retailer Next has also warned it will have to raise shop prices by around 1% this year to cover the impact from the Budget’s tax raid.
Bakery chain Greggs has already bumped up the price of its sausage rolls, as well as other products.
Meanwhile, pub chain Wetherspoons’ boss Tim Martin warned it may be forced to raise the cost of drinks.
The Sun approached Sainsbury’s for a comment.