Ikea to pay living wage to workers in UK

Earlier this month, UK Chancellor of the Exchequer George Osborne proposed introduction of a new national living wage at a rate of £7.20 per hour as part of the budget this year.

From 2016, Ikea will become the first national United Kingdom retailer to commit to paying its staff more than the new national living wage – meaning more than half of them will get a pay rise.

The government plans to introduce an increased employment allowance to soften the impact of the New Living Wage on employers, but the ACS said this would provide comparatively “small compensation” for convenience stores.

Following the Budget, the Living Wage Foundation welcomed the chancellor’s decision, but described it as “effectively a higher national minimum wage and not a living wage”.

Known for its self-assembly items, Ikea employs more than 9,000 staff in the United Kingdom, including hundreds at the mega store in Bristol.

He said that employers must pay at least that much to workers aged 25 and over from April, with the rate rising to more than £9 an hour by 2020. “We believe our people are the inner strength of our company, so it is only right to ensure we provide a meaningful wage that supports the cost of living”, she added.

In London, Ikea will pay a Living Wage of £9.15.

Gillian Drakeford, the country manager of IKEA in the United Kingdom and Ireland, said: ‘As a values-driven organisation, we are guided by our vision to create a better everyday life for people, which of course includes our co-workers.

Director of the Living Wage Foundation, Rhys Moore, said in a statement that he questions if it was even really a living wage.

The move is expected to boost the wages of six million people in both the public and private sectors.

The Living Wage is the latest in a series of investments that IKEA has made in its co-workers over the past two years.