Last reviewed 5 May 2021

In March, we reported that Ikea was refusing to introduce the new Real Living Wage (RLW) rate of £9.50 an hour (an increase of 20p on the previous rate) (see Ikea could be stripped of living wage employer status).

However, the Swedish firm chose 1 May, International Workers' Day, to announce a change of heart.

The GMB union had raised Ikea’s non-compliance with the Living Wage Foundation (LWF) and, after a series of discussions, Ikea has now agreed to increase staff pay to at least £10.85 in London and £9.50 across the rest of the UK.

It recently posted financial results showing total sales of £1.9 billion in the UK for the financial year ending 31 August 2020, with online sales surging 31% through the pandemic.

The LWF rate is independently calculated to reflect a Minimum Income Standard and is voluntarily paid by more than 7000 UK employers.

GMB regional organiser, David Shamma, said: “This is a real win for all Ikea staff on International Workers’ Day — they will really feel the difference in their pockets after 1 May. We want to thank Ikea for recommitting to the rate, after a little wobble earlier this year.”

Retail trade union Usdaw has welcomed IKEA’s commitment to continue as a Living Wage employer but said that it will continues to campaign for a “New Deal for Workers” with a minimum wage of at least £10 per hour.