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Tesco has announced a 2.7% increase for its staff hourly rates, which will see their pay increase from £9.30 to £9.55 an hour.

The deal, which kicks in from 5 September, applies to all hourly paid staff in Tesco’s stores and customer fulfilment centres.

Tesco said the one-year deal had been developed in partnership with union reps from Usdaw and stressed it was above the rate of inflation.

It also pointed out that in July 2014 its hourly rate had increased by 29.2%.

Tesco is also increasing night premium payments for eligible staff from the current rate of £2.21 to £2.30 from 5 September 2021 – an increase of 4.1%.

The award comes days after Tesco vowed to “strongly defend” its right to pay tens of thousands of shop and distribution centre staff different rates, despite a landmark EU ruling.

The European Court of Justice yesterday ruled last week an EU law did apply to UK staff making equal pay claims against their employer.

Tesco workers, the majority of whom are women, claim they have failed to receive equal pay for work of equal value with colleagues in its distribution centres, who are mostly men, and that it is in breach of EU and UK laws.

Today Tesco insisted it was e committed to working in partnership with unions, and would “continue to review and invest in our colleagues’ reward to ensure we remain an employer of choice”.

UK CEO Jason Tarry said: “It is important that we reward our colleagues for all they do, particularly after the last year when colleagues worked harder than ever to serve customers safely through the pandemic.

“We recognised their heroic efforts with separate, additional bonus payments through the year, and today, we are pleased to share a further investment in base salary.

“Over the last year our colleagues have gone above and beyond to continue to serve our customers throughout the pandemic. Together with our other colleague benefits, it makes our total reward package more competitive than ever before.”

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