Tesco USDAW pay and redundancy calculator 2026 | Expert Zoom

Frequently Asked Questions

• What is the Tesco pay rate from March 2026?

  Under the Tesco / USDAW Pay Agreement 2026, the standard hourly rate increased to £13.28 from 29 March 2026 — a 5.1% rise. Colleagues working inside the M25 receive an additional London Location Allowance of £1.27 per hour, bringing their rate to £14.55 per hour. The deal represents a 43% cumulative increase over five years and sits significantly above the National Living Wage of £12.21 per hour.

• How is redundancy pay calculated for Tesco employees?

  Tesco colleagues are entitled to statutory redundancy pay under ERA 1996 s.162: 0.5 week's pay per year of service under age 22, 1 week's pay per year aged 22–40, and 1.5 weeks' pay per year aged 41 and over. Weekly pay is capped at £700 (from April 2026), a maximum of 20 qualifying years counts, and the statutory maximum is £21,000. No confirmed enhanced redundancy scheme above the statutory minimum has been published for the 2026 Tesco / USDAW agreement — check with your USDAW representative for any additional entitlement.

• How many days annual leave do Tesco retail colleagues receive?

  Tesco provides a minimum of 28 days' annual leave for all colleagues, in line with the Working Time Regulations 1998 minimum. Entitlement increases with length of service — typically reaching 30 days after one year, 32 days after five years, and up to 33 days for colleagues with ten or more years of service. The 2026 Tesco / USDAW agreement also introduced up to three days' paid domestic abuse leave, a first for UK retail. The holiday year runs 1 April to 31 March.

• What is the notice period for Tesco employees?

  Tesco's notice periods follow the ERA 1996 s.86 statutory minimum: after completing one month's service, an employee is entitled to one week's notice from the employer; this increases by one week for each complete year of service, up to a maximum of 12 weeks. If an employee resigns, the minimum statutory notice they must give is one week after the first month's service. Tesco may exercise a payment in lieu of notice (PILON) or place a colleague on garden leave during their notice period.

• Which pension scheme covers Tesco retail colleagues?

  Most Tesco colleagues in the UK are enrolled in the Tesco Retirement Savings Plan (TRSP), a defined contribution (DC) scheme administered by Legal & General. Tesco matches employee contributions pound-for-pound up to a maximum of 7.5% of pay. The legacy Tesco PLC Pension Scheme (a defined benefit scheme) is closed to new entrants. Auto-enrolment minimums under the Pensions Act 2008 apply: at least 5% employee and 3% employer contributions on qualifying earnings (£6,240–£50,270 band, 2026).

• Does the Tesco / USDAW agreement provide enhanced redundancy above the statutory minimum?

  No enhanced redundancy scheme above the ERA 1996 statutory minimum has been confirmed in the published 2026 Tesco / USDAW Pay Agreement. Colleagues are entitled to the statutory formula: up to 1.5 weeks' capped pay (£700/week maximum) per qualifying year of service, for up to 20 years. If you believe your employment contract or a prior collective agreement provides enhanced terms, contact your USDAW representative for clarification.

• What is the London Location Allowance at Tesco in 2026?

  Tesco colleagues working inside the M25 receive a London Location Allowance of £1.27 per hour on top of the standard national rate of £13.28 per hour, giving a total hourly rate of £14.55. This supplement recognises the higher cost of living in Greater London and is part of the 2026 Tesco / USDAW Pay Agreement.

• What is the domestic abuse leave entitlement at Tesco?

  Under the 2026 Tesco / USDAW Pay Agreement, Tesco introduced up to three days' paid domestic abuse leave for all colleagues — described as a UK retail first. This leave is available to colleagues who need time away from work as a result of domestic abuse and is additional to statutory sick leave and other contractual leave entitlements.