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Ikea to offer improved pay and bonuses for UK staff

People paying product at self check out counter inside Ikea store

Ikea has announced an investment of over £35 million in increased wages and bonuses for its UK employees.

The flatpack giant also plans to implement a 10 percent pay raise for hourly paid employees in 2024. 

The company will deliver this pay rise in two installments, comprising two five percent increments based on current pay rates. 

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As a result, hourly wages will reach £12, rising to £13.15 for employees based in London. 

The Swedish furniture retailer, with 20 stores across the UK and an additional city store in London, has been operating in the country for over 35 years.

This pay hike ensures that Ikea's employees surpass the national living wage standards, which currently stand at £10.42 for workers aged 23 and above. 

The wage would rise to £11.44 in April 2024 and will include 21 and 22-year-olds for the first time. 

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Ikea had previously introduced an "outer London" rate for more than 1,300 staff in specific locations, such as Lakeside, Reading, and Milton Keynes. 

This rate is slated to increase from £11.45 to £12.60 in 2024.

Employees on fixed salaries would receive an average five percent pay raise, incurring a total cost of nearly £10 million for the company. 

End-of-year bonuses for all eligible staff

Ikea could also distribute year-end bonuses to all eligible staff.

It amounts to at least a month's pay and totals £25.6 million across the UK. 

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This bonus, combined with the planned wage increases, forms part of a £35 million investment.

It recognises the staff's contribution to the company's robust financial performance in challenging market conditions.

Darren Taylor, people and culture manager for Ikea UK, said: “At Ikea, we’ve always been committed to caring for our co-workers, particularly during challenging times, which is why we’re announcing further investment to enhance their financial stability and security.

“Although we see inflation starting to ease, the cost of living continues to have a very real impact.”

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