British supermarket chain Morrisons is increasing the pay of its store and manufacturing workers to £10.20 ($12.47) amid the UK’s cost of living crisis.

The pay rise represents a 2% minimum increase on their base rate, making Morrisons the highest paying supermarket for store colleagues in the country.

The retailer also confirmed that the minimum wage for its London staff will be £11.05 an hour, matching the London Living Wage.

This rise applies to all Morrisons stores within the M25 motorway.

The new pay deal is set to come into effect in October this year subject to staff approval.

Morrisons people group director Clare Grainger said: “Following last year’s 8.7% pay increase for our Customer Assistants, Morrisons was the first UK supermarket to reach the £10 an hour mark, and we’re very pleased to be maintaining our position as the highest paying UK national supermarket.

“Today’s announcement recognises the important contribution our colleagues make in serving local communities up and down the country.” 

In January last year, Morrisons became the first UK supermarket to guarantee hourly pay of £10 an hour for its store customer assistants.

Besides their pay, the retailer’s workers can make use of other benefits, including an unlimited 15% colleague discount, two 10% family and friends discounts and a competitive pension.

Union of Shop, Distributive and Allied Workers (USDAW) national officer Joanne McGuinness said: “USDAW has negotiated an established rate of £10.20 per hour for Morrisons workers, which is the highest basic pay rate in the supermarket sector.

“Our members in Morrisons will now be balloted on the company’s offer.”

Earlier this year, Tesco increased the pay of its hourly-paid store and customer fulfilment centre (CFC) workers by 5.8% to £10.10, up from their existing hourly wage of £9.55.