UK Living Wage Update: Increases in National and Real Living Wages

In a significant move to support the UK’s lowest-paid workers, the Chancellor has pledged to accept the recommendations put forth by the Low Pay Commission, which are set to be unveiled in November. According to the Commission’s latest projections, this commitment will result in a substantial increase in the National Living Wage to over £11 per hour, effective from April 2024. This increase will mean a significant boost in annual earnings for full-time National Living Wage workers, with an estimated increase of over £1,000 in the next year.

In addition to this notable development, the Real Living Wage has also undergone a recalculation, with the new rates set at £12 in the UK and £13.15 in London. Over 460,000 workers currently receiving the Living Wage are poised for a wage increase, thanks to the participation of over 14,000 Living Wage employers who have agreed to adhere to these new rates.

The impact of these new Real Living Wage rates is substantial, providing workers with an annual income that is now more than £3,000 above the minimum wage in the UK and over £5,000 higher in London. Notably, the Real Living Wage, established by the Living Wage Foundation, remains the sole wage rate determined independently based on the actual cost of living. Unlike the government-mandated minimum wage, the National Living Wage, which applies to those over 23 and currently stands at £10.42, the Real Living Wage is the only wage rate that takes into account the continuously rising living costs and applies to all workers over 18.

The momentum behind the Living Wage movement is undeniable, with an impressive 14,000 Living Wage Employers now on board, including prominent companies like Aviva, Everton FC, IKEA, and LUSH, as well as numerous small businesses. These employers have made the conscious choice to pay the Real Living Wage, offering their employees and their families greater financial security and stability.

Katherine Chapman, the Director of the Living Wage Foundation, has said:

As inflation eases, we cannot forget that low paid workers remain at the sharp end of the cost of living crisis. ow paid workers continue to struggle with stubbornly high prices because they spend a larger share of their budget on food and energy. These new real Living Wage rates are a lifeline for the 460,000 workers who will get a pay rise .During these tough economic times, it is heartening that record numbers of employers are signing up to join the Living Wage movement, protecting everyone who works for them – including cleaners -from rising prices and seeing the benefits of a more motivated and engaged workforce”

At Rahman Lowe Solicitors, we understand the complexities of employment law and its impact on both employers and employees. Whether you’re an employer seeking compliance, or an employee facing wage challenges, our expert team is here to protect your rights and provide tailored legal solutions. Contact us today to navigate the changing employment landscape with confidence