Lidl GB raises staff pay for third time in a year

FILE PHOTO: Lidl's Scottish distribution centre in Motherwell, Scotland

LONDON (Reuters) - The British arm of German discount supermarket Lidl has raised pay for store and warehouse staff for the third time in 12 months, it said on Wednesday.

With Britain's stubbornly high inflation rate falling by less than expected to 8.7% last month, the Bank of England is watching pay settlements closely as it weighs any further rises in interest rates.

Lidl GB, part of the Schwarz retail group, employs 24,500 hourly-paid workers in Britain.

It said that from September, staff working outside of London (outside the M25 motorway) will see hourly pay increase to 11.40 pounds ($14.39) from 11.00 pounds, rising to 12.30 pounds depending on length of service.

Pay for London workers (inside the M25) will increase to 12.85 pounds from 11.95 pounds, rising to 13.15 pounds.

Lidl GB said it has invested 60 million pounds in staff pay over the last year.

Lidl GB and rival discounter Aldi UK are Britain's fastest growing grocers, with sales up 23.2% and 24% respectively over the 12 weeks to May 14 year-on-year, according to industry data.

($1 = 0.7923 pounds)

(Reporting by James Davey; Editing by Sachin Ravikumar)