Sainsbury's Awards Shop Staff 4% Pay Rise

Sainsbury's has given its staff a bumper 4% pay rise - the biggest increase in a decade.

The increase, which takes effect from 30 August, will see 137,000 of its shop floor workers earning £7.36 an hour.

These include workers under the age of 25 who are not covered by George Osborne's living wage legislation.

That legislation comes into force in April next year.

Nearly a third of Sainsbury's shop floor staff are under the age of 25, so nearly 40,000 of its younger employees will benefit the most.

The minimum wage is currently £6.50 for those aged 21 and over, but under the Chancellor's new scheme this will rise to £7.20.

This means that Sainbury's workers will be getting 16p per hour more than the mandatory level - seven months early.

The 28p per hour pay rise will mean increased wage bills of around £1m a week.

This is crucial as the big four supermarkets look to cut costs amid a price war with the German discounters, such as Lidl and Aldi.

Earlier this month, Asda boss Andy Clarke stressed that all supermarkets will have to work on the assumption that discount traders will double their market share.

Aldi and Lidl currently control 5.6% and 4.1% of the UK grocery market respectively.

On Tuesday, market research firm Kantar reported that Sainsbury’s was the only one of the ‘big four’ retailers to have seen an increase in sales in the 12 weeks to 16 August.

The sales were up by 0.1% - its first growth since March.