What: M&S announces GBP 95 million investment in retail pay, raising hourly rates to GBP 12.60 nationwide and GBP 13.85 in London, while maintaining comprehensive benefits including industry-leading pension contributions and extended parental leave.

Why it is important: The significant wage increase, coupled with extensive benefits, demonstrates how major retailers are redefining their approach to employee value propositions, setting new industry standards for workforce compensation and benefits.

Marks & Spencer has unveiled its largest-ever investment in retail pay, committing GBP 95 million to enhance compensation for approximately 50,000 customer assistants across the UK. Starting April 2025, the base hourly rate will increase to GBP 12.60 nationwide and GBP 13.85 in London, representing a 5% rise from previous levels and a remarkable 26% increase since 2022. Team support managers will also benefit from increased rates of GBP 13.65 nationally and GBP 14.90 in London. The comprehensive benefits package includes an uncapped 20% employee discount, industry-leading pension contributions of up to 12%, and extensive parental leave provisions with 26 weeks of full pay for maternity and adoption leave, plus six weeks for paternity leave. Despite facing significant cost headwinds from recent tax and National Insurance changes, CEO Stuart Machin has emphasised the company's commitment to protecting hourly paid colleagues, marking the third consecutive year of record investment in retail pay.

IADS Notes: M&S's record GBP 95 million investment in retail pay represents a significant milestone in the evolving landscape of retail compensation. This follows their February 2024 commitment of GBP 94 million towards staff benefits and enhanced family leave policies, demonstrating a sustained approach to employee welfare. The move aligns with broader industry trends, as evidenced by John Lewis's GBP 116 million investment in March 2024, which delivered a 10% pay increase. The competitive nature of retail compensation was further highlighted when Costco announced plans in January 2025 to raise hourly wages above USD 30, while Sam's Club implemented significant wage increases for 100,000 workers in September 2024. These developments collectively signal a fundamental shift in how major retailers approach workforce compensation, recognising employee retention and satisfaction as crucial elements of sustainable business growth.

M&S to make biggest ever investment in retail pay