New Living Wage rates for London and the UK


The Living Wage Foundation has, this morning, announced that Accredited Living Wage employers will pay their staff the new voluntary Living Wage rate of £8.25 per hour, rising from £7.85. The new rate is significantly higher than the national minimum wage of £6.70 per hour, and the new National Living Wage of £7.20 that will come into force across the UK in April 2016.

In London, Mayor Boris Johnson announced that the Living Wage will rise from £9.15 to £9.40 per hour, a near 3% increase. The rate in London is expected to follow a similar upward trend to the national rate, and is already set above the anticipated 2020 target for National Living Wage for over 25s of £9.00 per hour.  The number of employers paying the London Living Wage has grown from 429 to 724 in the past 12 months and increased by over 40% over 10 years - with over 30,000 workers benefiting since 2011.

The announcement today will see a pay rise for approximately 68,000 staff that are employees of the accredited businesses that commit to paying all their staff, including sub-contracted teams working on their premises, the Living Wage.

The downside

Only yesterday, auditor KPMG announced that some 5.84 million people are paid less than the Living Wage. The latest figure indicates that 23% of all employees are now earning less than the Living Wage – up from 22% last year.

Although the rise sounds modest, in real terms it equates to 497,000 people. During the same period, the total number of jobs grew by 435,000 to just over 25 million. The proportion of workers earning less than the Living Wage has risen for the third year running. Data from research from the auditor also shows a worrying trend which sees part-time, female and young workers as the most likely to earn a wage that fails to provide a basic but decent standard of living.

Welcome news

Frances O’Grady welcomed the news of the new rates. She said: “It’s good news that the number of Living Wage employers is growing. It’s a basic standard many more employers should meet. But 6 million people are still scraping by on less than the Living Wage, despite many working for employers who could afford to pay it.”

London Mayor Boris Johnson said: “I am delighted that more than 700 employers have signed up to paying the London Living Wage and we now have tens of thousands of employees being properly rewarded for the work they do. As our economy continues to grow and employment in London increases, it is essential all hard-working Londoners receive a fair share of the proceeds of the capital’s success. I have long argued that those companies that can afford to pay the London Living wage should do so because there are clear benefits for employers in increasing the productivity and reducing staff turnover, while it makes a real difference to the quality of life for employees.”

Turn2us for support

If you are struggling to make ends meet, use our Benefits Calculator to check your entitlement to welfare benefits and our Grants Search to see if you are eligible for help from a charitable fund, based on your personal background, circumstances and needs.

Our website contains resources on benefits and grants and a Find an Adviser tool to help you find national and local sources of further advice.

Source: The Living Wage Foundation Press Release
              KPMG Press Release