J Sainsbury PLC (LSE:SBRY) has awarded workers a 9% pay rise nationwide to match the new Real Living Wage nationally and the London Living Wage, taking effect on 1 May.
Though Sainsbury’s is not an officially accredited Living Wage employer, this latest pay rise is in line with the minimum standards suggested by the Living Wage Foundation.
The move could help quash lingering accusations of profiteering levelled against Sainsbury’s and other major retailers during the cost-of-living crisis.
But despite being accused of hiking grocery prices above the rate of inflation, Sainsbury’s has a decent track record with wages.
Sainsbury’s bumped up wages by 10% this time last year, to £11 per hour outside of London and £11.95 in London.
The latest pay rise to £12/£13.15 was a slightly more modest 9%, meaning the average colleague nationwide will take home £1,910 extra per year (£2,290 in London) when the new rate takes effect in March.
In both instances, Sainsbury’s pre-tax wage increases matched or exceeded the going rate of inflation.
Chancellor of the Exchequer Jeremy Hunt said: “It’s great to see Sainsbury’s rewarding hard work with this pay rise for 120,000 employees around the country”.
“Our colleagues do a brilliant job delivering for our customers every day and at the same time they are continuing to face the rising costs of living,” stated Simon Robert, chief executive of Sainsbury’s. “So, in addition to investing to keep our prices low for customers, I’m delighted to confirm an industry-leading pay increase again this year for all our hourly paid colleagues.”
Despite the decent wage hikes, Sainsbury’s takes a conservative approach to wage control.
In the most recent annual report, group data showed that total employee costs fell 60 basis points to £3.58 billion on the back of lower full-time equivalent workers (107,000 compared to 117,000).