The London Living Wage

What is the London Living Wage

The voluntary London Living Wage (LLW) is based on the principle that workers should earn a living to provide for themselves and their families. 

Workers who are paid the Living Wage are more financially secure - they are more able to pay rent, buy food and pay taxes - as it's designed to better reflect the cost of living.

It's argued that workers who earn the National Minimum Wage (now referred to as the mandatory Living Wage) are reportedly exposed to greater financial instabilities, and more likely to endure homelessness, poverty, health risks and the loss of dignity that comes from not earning a fair living.

The voluntary Living Wage can benefit employers as well as employees. Employers report benefits such as:

  • higher staff morale
  • improved rates of retention
  • lower rates of sickness and absence
  • reputational gain

You can find out more information on the benefits of the voluntary Living Wage from the Living Wage Foundation.

How much is the London Living Wage

The Living Wage Employer Mark and Service Provider Recognition Scheme is an accreditation for businesses who wish to pay the voluntary Living Wage. 

The 2017 Living Wage rate is:

  • £10.20 per hour in London
  • £8.75 per hour across the UK

London's rate is set independently by the Greater London Authority (GLA). The rate for the rest of the UK is set independently by Loughborough University. 

The rate is updated annually based on changes to the cost of living. The new rate is announced in November and accredited businesses have until the following April to implement the new rate.

The Living Wage is:

  • based on the actual cost of living
  • updated annually in November
  • voluntary for both employers and staff (unlike the statutory National Minimum Wage)

The National Living Wage

The National Living Wage is the new name for the ‘National Minimum Wage’ (introduced by the government in April 2016) and:

  • is being introduced in stages, the new rate is £7.20 per hour for employees aged over 25 (will increase to £9 by 2020)
  • is a statutory minimum wage for all staff aged 25 and over
  • is a statutory requirement for all employers
  • is based on median earnings
  • the change won't affect people 24 year olds and under currently receiving minimum wage (which is £6.70 per hour from 1 October 2015)
  • 18 to 20 year olds' current rate will increase by 17 pence to £5.30 per hour
  • 16 to 17 year olds' current rate will increase 8p to £3.87 per hour

You can read more about the mandatory National Minimum Wage.

Become a Living Wage Employer

To qualify as a Living Wage employer, you'll need to:

  • pay the Living Wage to all directly employed staff
  • ensure contractors and sub-contractors (who provide regular services to your organisation on your premises) pay the Living Wage to staff 

The Living Wage Foundation offers support and advice on becoming an accredited Living Wage employer. You can find more information on how we support local businesses here.

Page last updated: 22 January 2018