Sainsbury’s is to give its 137,000 shop floor staff a 4% pay rise from next week.
The supermarket will raise its standard hourly rate from £7.08 to £7.36 for staff of all ages – including the 40,000 aged under 25.
This will bringing their hourly rate above the new national living wage for over-25s, which is due to come into force next April.
This is retailer’s biggest pay increase in more than a decade.
It is not known if the supermarket plans to increase pay for its 24,000 non-store staff and store managers.
Sainsbury’s chief executive Mike Coupe said: “We know what a difference they make to our customers each and every day and we’re totally committed to rewarding them well for the great service they provide.
“I’ve talked to thousands of colleagues over the past year and they tell me how much they value their package of benefits and the flexibility that we can offer as an employer, as well as hourly pay which has always been well over the minimum wage.”
Chancellor George Osborne announced a new compulsory living wage for over-25s of £7.20 per hour in the summer budget in July.