A coffee chain owned by Cola-Cola gave 14,500 staff a 5% pay rise – having made 600 people redundant last year

Costa Coffee
A Costa store. Getty/Dan Kitwood
  • UK chain Costa Coffee is giving its 14,500 staff an hourly pay bump of at least £0.45 ($US0.62 ($AU1)) per hour.
  • Costa, owned by Coca-Cola, says the rise is in recognition of staff’s work during the pandemic.
  • In 2020, Costa got rid of 600 workers – now, it plans to hire 2,000 more.
  • See more stories on Insider’s business page.

The UK coffee chain Costa Coffee is giving all its 14,500 staff a 5% pay rise, and plans to recruit 2,000 more people amid increasing demand, it said.

Costa, owned by Coca-Cola, said in a release on Thursday that the pay rise was to recognize the “commitment and continued passion” of its workers during the COVID-19 pandemic, many of whom have faced “their own personal challenges in unprecedented times.”

From October 1, 2021, pay for all staff will rise by at least £0.45 ($US0.62 ($AU1)) an hour, Costa said. Some staff are set for a bigger pay bump – hourly wages for Barista Maestros, who supervise shifts, will rise by £0.65 ($US0.90 ($AU1)), Costa said.

The chain said that it planned to recruit 2,000 more workers to new shops to prepare for increased demand in the run up to the holiday season. The new starters will also benefit from the rise, but it will not apply to franchise workers, Costa said.

Costa, like many hospitality businesses, suffered during coronavirus lockdowns. In September 2020, it announced that 1,650 roles were at risk, and eventually let 609 staff go after removing the assistant store manager role.

In Thursday’s release, Costa also announced it would boost its benefits: it will now offer staff discounts at other high-street stores, free coffee during shifts, an enhanced pension, and other incentives, it said.

Workers will, on average, take home between £500 and £800 ($US693 ($AU941) and $US1,109 ($AU1,505)) more a year if they work between 20 and 40 hours a week, Costa said.

Amid an ongoing labour shortage, companies across the hospitality, logistics, and service sectors have been boosting wages in order to support burned out workers and attract new staff.

Many workers have been quitting as a result of increased pressure due to COVID-19 restrictions, abusive customers, and understaffed teams. Businesses in the UK have also been hit by an exodus of EU nationals following the country’s departure from the European Union.