Aldi trumps rivals with living wage hike

Aldi is increasing wages for its shop floor staff to above the rate paid by all its supermarket rivals at time of intensifying competition in the sector, reports The Telegraph.

The German discounter, which now counts half of Britain’s households as shoppers, has revealed that it will introduce a new £8.40 minimum rate for all UK staff from next February, regardless of their age.

Aldi is the latest retailer to trump Chancellor George Osborne’s £7.20 national living wage requirements for over-25s announced in the July budget.

However, Aldi has taken the move as an opportunity to trounce its Big Four rivals, who are already under pressure to compete with it on prices and exceed discount peer Lidl’s salary promise.

“Just as Aldi won’t be beaten on the low prices of our products, we are also committed to offering the best pay and benefits in the industry”, said Matthew Barnes, Aldi UK & Ireland chief executive.

The discounter, which has just opened its 600th store, will pay staff £9.45-an-hour in London and said the new rate represents a 3pc lift on the entry-level pay for store assistants and almost 16pc for stock assistants and caretakers.

Around 5,000 staff will get a pay rise as a result of the announcement, out of 28,000 in the supermarket’s UK workforce.

Aldi, which plans to have 1,000 stores by 2022 and recruit 35,000 more people, emphasised that it is one of the few supermarkets that gives its employees paid breaks.

In September, 96 Comments for 90,000 shop staff however it revealed that the pay hike would be funded by axing Sunday pay and paid breaks.

Sainsbury’s has also recently increased wages to £7.36 an hour but says that staff receive more than equal to Morrisons as it pays for 30-minute lunch breaks and other perks such as food vouchers.

Lidl was the first supermarket to react to the living wage and has said it will pay its 9,000 staff at least £8.20 an hour, although it does not pay for breaks.

Meanwhile, Britain’s biggest supermarket Tesco is still in discussions with unions over this year’s pay deal for shop floor staff but has warned that the Chancellor’s living wage will cost it £500m by 2020.