Lidl employees will earn high from November.

From October, Lidl UK employees will earn a minimum of £8.20 an hour across England, Scotland and Wales, and £9.35 an hour in London, the supermarket said.

The Foundation will announce a change in its recommended rates in November.

The rate is different from the National Living Wage as set out in the Budget.

Lidl said that if the Living Wage Foundation raised its recommended rate in its annual announcement in November, Lidl would adjust its minimum wage accordingly.

Currently, Lidl pays its staff a minimum of £7.30 an hour and £8.03 an hour inside London.

 

The Living Wage Foundation's current recommended minimal hourly rate is £7.85, and £9.15 inside London.

The National Living Wage as required by the UK government, which was set out in George Osborne's July Budget, is set to be £7.20 an hour from April 2016 for people aged over 25.

Lidl said its new pay rate would amount to an average wage increase of £1,200 a year, "with 53% of Lidl UK's 17,000 workforce and all age brackets benefiting from the rise".

'Commitment to staff'

The chief executive of Lidl UK, Ronny Gottschlich, added: "As a result, Lidl employees will be amongst the best paid in the supermarket sector."

The director of the Living Wage Foundation, Rhys Moore, told the BBC: "We are thrilled. We've been working with and trying to persuade the retail sector to commit to pay the living wage rates rather than National Minimum Wage [now called the National Living Wage]. 

"None of the big four supermarkets currently pay the living wage rates, and the BRC [British Retail Consortium] are very behind the curve on this. Lidl is demonstrating this commitment to staff, and customers want to know that they're shopping in places which treat their staff well."

The BRC said there was a lack of evidence to support the implementation of a minimum wage.

In a statement, a spokesperson told the BBC: "Whatever approach retailers take to their total reward packages, the real key to raising more people out of low pay will rest in increasing productivity.

"This is an area where there is a lack of detailed evidence and one which we are working on understanding better."

Position of strength

Richard Perks, retail director at consultants Mintel, told the BBC that Lidl's success in recent years had put it into a position to upstage its rivals.

"Lidl's profits must have risen very sharply in the UK during the last few years so it has the headroom to do this."

"The big four supermarkets are going the other way. They are all losing market share, they are all under pressure, they are all seeing markets decline. They will be struggling to do this now and if they did they would have to put up prices."

However, Mr Perks added that was somewhat hard to tell how well Lidl was doing because it was "very sensitive about its finances".

The Living Wage Foundation's rate is an informal benchmark, not a legally enforceable minimum level of pay.

It is calculated by academics as the level of pay that will give workers enough for a basic standard of living.