The Real Living Wage
- 3.5 million workers, or 12% / 1 in 8, are paid below the real Living Wage.
- There are 14,000 accredited Living Wage Employers.
- 460,000 workers receive pay rises every year thanks to the real Living Wage.
- We’ve put £3 bn back into the pockets of workers since the campaign began over 20 years ago.
- 1 in 9 workers in the UK work for Living Wage Employers.
- The real Living Wage worth £3,081 more a year than the current National Living Wage.
- The London Living Wage worth £5,323.50 a year more than the current National Living Wage.
There would be a £1.7 bn boost to UK economy if 25% of low-paid workers were moved onto the real Living Wage.
Life on Low Pay Research
- 60% of low-paid workers have used a foodbank in the past year.
- 50% of low-paid workers say they are worse off than a year ago.
- 39% have regularly skipped meals.
- 39 have fallen behind on bills in the past year.
- Over a quarter (27%) have fallen behind on their rent / mortgage payments.
- Over a fifth (21%) have taken out a payday loan to cover just their essentials.
- Half said they are worse off than a year ago.
Business Benefits stats
- 94% of Living Wage businesses say they’ve benefited since accrediting.
- 87% say it’s improved the reputation of the business.
- 66% say it’s helped differentiate them from others in their industry.
- 64% say it improved relations between management and staff.
- 62% of employers say paying a real Living Wage has improved recruitment of employees.
- 60% of employers say paying a real Living Wage has improved retention of employees.
- 113 accredited Living Hours Employers.
- Over 50,000 workers benefit from working for Living Hours Employers.
- 59 per cent of workers whose hours vary have been called into work with less than a week’s notice.
- 6.1m workers in the UK are in insecure work, with 3.4m being in low paid insecure work.
- This amounts to 19 and 11 per cent of workers in the UK respectively.
- 23 accredited Living Pension Employers
- 4 in 5 workers not saving at levels likely to meet basic needs in retirement.
- Only 1 in 20 low-paid workers saving at levels likely to meet basic needs in retirement.
Recognised Service Providers
- There are 188 Recognised Service Providers.
Living Wage Funders
- There are 65 Living Wage Funders.
Living Wage Places
- There are 16 Living Wage Places.
What is the real Living Wage?
The real Living Wage is an hourly rate of pay set independently and updated annually (not the UK government’s National Living Wage). It is calculated according to the basic cost of living in the UK, and employers choose to pay the Living Wage on a voluntary basis. According to the Living Wage Foundation, since 2011 the campaign has impacted over 430,000 employees and delivered over £2bn extra to some of the lowest paid workers in the UK.
About the Living Wage Foundation
The Living Wage Foundation is the institution at the heart of the independent movement of businesses, organisations and people who believe that a hard day’s work should mean a fair day’s pay. We recognise and celebrate the leadership shown by the over 13,000 Living Wage Employers across the UK who voluntarily commit to ensure their staff earn a real Living Wage that meets the cost of living. We are an initiative of Citizens UK.
Only the real Living Wage is calculated according to the cost of living in the UK and in London. Employers choose to pay this wage on a voluntary basis. The real Living Wage applies to all workers over 18 – in recognition that young people face the same living costs as everyone else. It enjoys cross party support. The UK Living Wage for outside of London is £10.90 per hour. The London Living Wage is £11.95 per hour. These figures are calculated annually by the Resolution Foundation and overseen by the Living Wage Commission, based on the best available evidence on living standards in the UK and in London.
What about the Government’s national living wage?
In July 2015 the Chancellor of the Exchequer announced that the UK Government would introduce a compulsory ‘national living wage’ (NLW). This new government rate was a new minimum wage for staff over 25 years old. It was introduced in April 2016 and the rate is £10.42 as of April 2023. From April 2021 it applies to everyone over 23 years old.
The rate is different to the Living Wage rates calculated by the Living Wage Foundation. The government rate is based on median earnings, while the Living Wage Foundation rates remain the only ones calculated according to the cost of living in London and the UK. A full-time worker paid the £10.90 real Living Wage will receive £936 in additional wages annually compared to the current Government minimum. For a full-time worker in London this figure rises to £2,983.50.
About our Living Hours Scheme:
The Living Wage campaign is based on the idea that a hard day’s work deserves a fair day’s pay. However pay is not the only thing affecting in-work poverty: this is also driven by the number and security of hours people work. That is why we are asking employers to provide Living Hours alongside the real Living Wage. Living Hours offers a practical solution that employers can adopt to help provide the security and stability that low paid workers need to make ends meet. The Living Hours campaign was developed over an 18-month period of consultation with workers, Living Wage Employers, trade unions and experts. This culminated in a set of measures to tackle the problems associated with casualised and insecure work:
At least four weeks’ notice for shifts, with guaranteed payment if shifts are cancelled within this notice period
The right to a contract that reflects actual hours worked.
A guaranteed minimum of 16 hours a week (unless the worker requests otherwise
By offering Living Hours to directly employed staff who might be at risk of in-work poverty and relevant third-party staff covered by the Living Wage commitment, employers are committing to provide workers with secure hours and predictable shifts. This means continuing to build relationships with employees based on dignity and respect, as well as shaping employment cultures with shared responsibility and reciprocity at their heart.
For more information on the Living Hours scheme, visit: https://www.livingwage.org.uk/living-hours
About our Living Pensions scheme:
The Living Wage campaign is based on the idea that workers should be paid a wage at least enough to meet basic everyday needs. But those needs don’t end with retirement. Age UK say over 2 million pensioners in the UK, or 1 in 5, are in poverty, and pensioner poverty has risen over the last decade. Resolution Foundation research commissioned by the Living Wage Foundation found that 4 in 5 workers are not saving into pensions at levels likely to provide an income in retirement which meets basic everyday needs. Low-paid workers struggle most with pension saving, with 95% not saving enough to reduce the risk of poverty in later life. They are not only struggling to keep their heads above water today, but also worrying about an uncertain future, unable to save or plan for the years ahead. By providing a Living Pension as well as a real Living Wage, employers can provide workers with security and stability now and in the future.
The Living Pension is a voluntary savings target for employers, to help workers build up a pension pot that will provide enough income to meet basic everyday needs in retirement. It is independently calculated by the Resolution Foundation based on the real cost of living. The standard sets out the minimum annual contribution required through an average working life to reach this savings level and employers commit to making sure all workers can access this.
The Living Pension accreditation is open to all accredited Living Wage Employers. To become a Living Pension Employer, organisations must provide a Living Pension savings level, using either a cash or percentage target. The savings target is 12% of an employee’s annual earnings, or a cash amount of £2,550, of which an employer pays at least 7%, or £1,448. The Living Pension must apply to all directly employed staff (regardless of age and earnings) and, over time, third party contracted staff within scope of the Living Wage. As well as making the minimum savings level available for existing employees, all new employees should automatically be enrolled on the Living Pension at least. As part of the accreditation, employers must also agree to provide an annual communication on the Living Pension to all employees, and a template will be provided to support this.
The Living Pension standard has been developed with guidance from the Living Pension Steering Group, made up of industry bodies, employers and union representatives, and received financial support from Abrdn Financial Fairness Trust.
What about the Government’s auto enrolment pension?
All employers must provide a workplace pension scheme. This is called ‘automatic enrolment’. Employers must automatically enrol employees into a pension scheme and make contributions to their pension if they are classed as a ‘worker’; they are aged 22 to state pension age; they earn at least £10,000 per year and they ordinarily work in the UK. There are some exclusions as outlined in Government guidance.
In most automatic enrolment schemes, contributions are based on ‘Qualifying Earnings’, which is total earnings between £6,240 and £50,270 a year before tax. Empoyers are required to pay 3% of Qualifying Earnings and Employees are required to pay 5% (which includes 1% tax relief). Employees can choose to opt out of automatic enrolment but if they meet the thresholds outlined above, they must be re-enrolled again at least every three years.
Under automatic enrolment, a Living Wage employee working 37.5 hours per week would have £1201 going into their pension each year (with £450 coming from the employer), where as the Living Pension would be £2,550 (with £1,488 coming from the employer).