Outsourcer Serco is to hand £9 million in one-off payments to about 45,000 non-management staff as the firm lifted its profit guidance and dividend.
The cash is in recognition of the pressure many people, particularly the lower paid, are under, said Group Chief Executive Rupert Soames.
Shares in the company, which runs security, transport and immigration contracts, moved higher on Thursday after it posted a better-than-expected performance over the past six months despite staffing pressures.