Supermarket chain Asda has announced a £150m investment to boost hourly pay rates, which will benefit 120,000 colleagues in the UK. 

The move represents an 8.4% pay increase for hourly-paid store colleagues to £12.04, effective from 1 July 2024.  

The announcement, which will benefit more than 120,000 colleagues, positions the chain as one of the highest-paying grocery retailers in the UK.  

An interim increase to £11.44 for national colleagues will take effect on 1 April. The rate for those working in London, inside the M25 circular motorway, will be £12.61. London wages will then increase again to £13.21. The latest investment follows a 10% increase for hourly-paid retail roles during 2023 and marks a 28% total increase in retail pay since Asda’s acquisition by the Issa brothers and TDR Capital in 2021.  

Asda’s cumulative investment in retail pay is now nearing £415m.  

The proposed pay rates will surpass the UK government’s National Living Wage and the Real Living Wage, including the London Living Wage recommended by the Living Wage Foundation. 

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The new pay rates, which are dependent on the outcome of a ballot, will apply to Asda Retail and Asda Express colleagues.  

Trade union USDAW is advocating for members to accept the new rates, with a ballot concluding on 15 March.  

The final decision, including a pay rate increase for colleagues from former EG Group sites, will be announced on 18 March. 

The record investment is part of Asda’s strategic move to expand its convenience offering, aiming to become the second-largest grocery retailer in the UK.  

The announcement coincides with the opening of the UK’s 1,000th Asda Express store, in Stevenage. 

Asda co-owner Mohsin Issa said: “This record investment will see Asda become the highest paying grocery retailer in the UK, recognising the hard work of our store colleagues in serving customers every day.  

“We want to be a company that people are proud to work for, which is why we are proposing increasing pay for Retail and Express colleagues by more than 8% this year. As we celebrate our 1000th store opening, I want to thank all our colleagues for their commitment and dedication in bringing Asda’s great value fuel and groceries to more communities.”