Supermarket chain Lidl will become the first UK supermarket to introduce the recommended living wage.
More than 9,000 staff will be given a pay rise worth £1,200 a year from October.
The supermarket will pay a minimum of £8.20 an hour across England, Scotland and Wales and £9.35 per hour in London.
The move - which will cost £9m - sees Lidl exceed the hourly pay rates set by the Living Wage Foundation.
It recommends that employees are paid a minimum of £7.85 and £9.15 inside London.
Lidl claims it will be the first British supermarket to adopt the higher rate being set by the Living Wage Foundation.
Ronny Gottschlich, chief executive of Lidl UK, said: “We recognise that every employee forms an integral part of team Lidl, and each individual’s contribution is valued.
“It is therefore only right that we show our commitment, in the same way that the team commit to the business and our customers each and every day, by ensuring a wage that supports the cost of living.”
Lidl said it would not be raising prices as a results of the wage increases.