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 2022 Living Wage rate is:

  • £11.95 per hour in London
  • £10.90 per hour across the UK

The Living Wage rate is set independently by the Resolution Foundation and is overseen by the Living Wage Commission. 

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:

  • the new rate is £9.50 per hour for employees aged over 23
  • is a statutory requirement for all employers
  • is based on median earnings
  • 21 to 22 year old’s current rate is £9.16 per hour
  • 18 to 20 year olds' current rate is £6.83 per hour
  • 16 to 17 year olds' current rate is £4.81 per hour

You can read more about the mandatory National Minimum Wage.

Explaining UK wage rates

 

The minimum wage

Government minimum for under 23s

National living wage

Government minimum for over 23s

Real living wage

The only wage rate based on what people need to live

What is it?

£9.18

£9.50

£10.90 across the UK
£11.95 in London

Is it the law?

Statutory

Statutory

Voluntary

What age group is covered?

21 and older

23 and older

18 and older

How is it set?

Negotiated settlement based on recommendations from businesses and trade unions

A % of medium earnings, it aims to reach 66% of median earnings by 2024

Calculation made according to the cost of living, based on a basket of household goods and services

Is there a London weighting?

No London weighting

No London weighting  

Yes - separate higher rate for London

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.

Page last updated: 21 October 2022

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