Ikea has revealed plans to hike pay for UK staff as part of more than £35 million of investment in higher wages and bonuses.

The furniture retailer said its hourly paid employees will get a 10% pay rise in 2024, split into two 5% uplifts, based on their current pay.

The uplift will take hourly wages to £12, rising to £13.15 for staff in London.

The Swedish retail giant has 20 shop in Britain, as well as a smaller city store in London, after first opening in the UK more than 35 years ago.

The hike means Ikea employees will be paid more than the national living wage, which is £10.42 for workers older than 23, but is set to rise to £11.44 in April next year and apply to 21 and 22-year-olds for the first time.

Last year, Ikea introduced an “outer London” rate for more than 1,300 staff based in shops in Lakeside, Reading, and Milton Keynes, which will rise from £11.45 to £12.60 in 2024.

Staff on a fixed salary will get a 5% pay rise on average. Both measures will cost the retailer almost £10 million, it said.

Meanwhile, the company is set to give out a bonus to all eligible staff at the end of the year worth at least a month’s pay, amounting to £25.6 million across the UK.

The bonus pot, which coupled with wage rises totals £35 million, recognises employees’ contribution to the group’s strong financial performance last year despite challenging market conditions, it said.

Globally, Ikea’s owner Ingka Group made 41.7 billion euros (£36 billion) in retail sales in the last financial year.

Darren Taylor, people and culture manager for Ikea UK, said: “At Ikea, we’ve always been committed to caring for our co-workers, particularly during challenging times, which is why we’re announcing further investment to enhance their financial stability and security.

“Although we see inflation starting to ease, the cost of living continues to have a very real impact.”