Sainsbury’s to invest £20M to raise wages of up to 127,000 hourly workers by £0.25/per hour, starting in October; wage increase part of £25M investment in a wide-ranging cost of living support package

Sainsbury’s has announced a £25 million investment in a wide-ranging cost of living support package for hourly paid colleagues to support them with rising household costs, £20 million of which will be invested in a pay increase. 

For the first time, colleagues will receive an Autumn pay increase outside of the annual pay review, in an unprecedented step to support colleagues when they need it most. Sainsbury’s and Argos hourly retail colleague pay will go from £10.00 to £10.25 and from £11.05 to £11.30 per hour in London, which means all these colleagues will have had at least two pay rises this year to reflect the current challenges households are facing. 

It will bring investment into colleague pay this year to £150 million and demonstrates Sainsbury’s commitment to being a leading employer. It takes the pay increase for frontline, hourly paid colleagues to 7.9% this year and 28% over five years.*

The new support package will also give colleagues access to basic food items during shifts from the first week in October until the end of December and increased discounts at Sainsbury’s and Argos. The free food will ensure that colleagues can have something to eat while they are at work and the longer and deeper discounts will help colleagues plan and manage their budgets through the Autumn and in the run up to Christmas.

The new pay rates will be effective from 16th October and it is expected that 127,000 hourly paid colleagues across retail, local fulfilment centres and customer service contact centres will benefit. The additional increase will not affect the timing of the next annual pay review, which will go ahead in the new financial year. 

Sainsbury’s continues to help customers as well as colleagues with the cost of living crisis, with its biggest ever September price investment of £65 million. This is part of Sainsbury’s two-year plan to invest £500 million in low prices by March 2023, supported by an ambitious cost saving programme that enables Sainsbury’s to reinvest where it matters most. As outlined at Sainsbury’s preliminary results in April¹, while the investment in supporting customers and colleagues with the cost of living will mean lower profits this year compared to last year, focusing on support for customers and colleagues has to be the priority in the current circumstances. 

Simon Roberts, Chief Executive of Sainsbury’s said: “Every day, I am hearing from colleagues who are really feeling the pressures of the rising cost of living. That’s why we are doing everything we can to help our colleagues as they face rising bills and living costs this autumn by investing £25 million into a package of support, including an early pay increase. This is the first time we have given two pay rises in the same year. 

“Our top priority is to support our customers and colleagues. We are proud of our track record on colleague pay and, with this latest package of an additional pay rise, free food at work and bigger colleague discounts, we are very focused on doing as much as we can to help our colleagues and their families through this autumn and winter.”

David Gill, Usdaw National Officer, said: “We continue to work closely with Sainsbury’s on colleague pay and the 5.3% increase the company announced in March 2022 was fully supported by 92% of our membership.

“With the cost of living continually rising, we have kept open our dialogue with Sainsbury’s and we are pleased the business has responded so positively. This is an unprecedented additional Autumn pay award and the free food and additional discount will be appreciated by our members. It is a very challenging time at present and we are particularly pleased that this additional increase, due to take effect from October 2022, will not replace the usual pay review process which takes place annually.”

Colleagues can already benefit from year-round Sainsbury’s discount of 10%, increased to 15% for five days around payday. The latest increased colleague discount also means longer colleague discount uplifts over Christmas. This year, Sainsbury’s will have invested in three times as many 20% discount days as last year. To help colleagues plan their Christmas shopping, Sainsbury’s is also increasing colleague discount at Argos to 15% for one day every payday Friday until Christmas, starting from 23rd September.

Sainsbury’s is acutely aware of the pressures on household budgets and that is why the business is investing over £500 million over two years in keeping prices low on the essential items customers buy most often. The scale of this commitment means that Sainsbury’s is investing in value ahead of competitors and inflating behind the market on the fastest selling 100 lines. 

*A 28% increase in pay over the last five years represents the increase from £8.00 in September 2017 to £10.25 in October 2022.

Temporary colleagues will benefit from the pay rise and the free food but not the discount as that is currently awarded to colleagues after 3 months at Sainsbury’s.