IKEA Group announced on Monday that it will begin paying its employees above the government’s new National Living Wage next year.
Earlier this month Chancellor George Osborne announced a new compulsory living wage for workers aged over 25 of £7.20 an hour.
Chancellor George Osborne announced a a new compulsory living wage of £7.20 an hour in the Budget earlier this month.
The current minimum wage for people over 21 is £6.50 an hour.
Ikea, the privately owned Swedish retailer known for its self-assembly items, said that it will be paying all of its 9,000 UK workers at least £7.85 an hour from April 2016, with those in London to be paid at least £9.15 an hour.
Rhys Moore, director of The Living Wage Foundation, said in a statement:
“This is a huge step for the British retail sector and we hope that many other businesses will follow the leadership IKEA is showing on the issue of basic pay,”
The foundation welcomed Osborne’s decision, but described it as “effectively a higher national minimum wage and not a living wage”.
All in all the new living wage minimum will increase the wages of six million people across the country.
Ikea is currently the biggest furniture retailer in Britain. It has 18 stores and will be opening new stores in Sheffield, Reading, Exeter and Greenwich.