Tesco said it will pay out nearly £50 million in “thank you” bonuses to employees across its stores, customer fulfilment and customer engagement centres, worth 1.25% of their annual salaries, at the end of May.

The group said the payout “recognises the way colleagues really stepped up to the industry challenges of the last year” and comes as it reported annual profits more than trebling to over £2 billion.

The bonus is the latest cheer for Tesco workers, after the supermarket giant – the UK’s largest private employer – announced last week that it was hiking pay to over £10 an hour.

It said it was increasing hourly pay for shop staff and warehouse workers by 5.8% from £9.55 to £10.10 from July 24.

The move comes after a raft of supermarket rivals, including Sainsbury’s, Morrisons, Lidl and Aldi, increased their rate of basic pay in the face of the cost-of-living crisis.

Tesco also confirmed last Thursday that it will increase the hourly rate for its customer delivery drivers and click & collect assistants to £11 from July.

The bonus payout follows a challenging year for the supermarket sector, which has had to battle against surging demand in lockdowns, staff shortages due to Covid-19 and supply chain issues at home and abroad.

On announcing the group’s annual figures, Tesco chief executive Ken Murphy said: “Over the last year, we delivered a strong performance across the group, growing share in every part of our business.

“We did this by staying focused on our customers and doing the right thing for our colleagues, our supplier partners and the communities we serve.

“I want to thank all of our colleagues who did a brilliant job navigating the ongoing pandemic, dealing with the supply chain challenges in the industry and tackling the onset of increasing inflation.”

Tesco staff bonuses: £50m bonus payments for 290,000 shop workers, call centre staff and warehouse workers to thank them for their efforts