Real living wage to rise to at least £12 an hour – here's what you need to know
Over 460,000 workers in the UK are set to see their hourly pay rise by 10% due to an increase in the 'real living wage'; a voluntary employers' pay scheme based on the cost of living. The change means those covered by the scheme will see pay rise to at least £12 an hour, while those in London will get £13.15.
According to campaign group the Living Wage Foundation, which sets these rates, the increase reflects persistently high costs for low paid workers. The previous rates were £10.90 an hour across the UK and £11.95 for workers in London.
Employers should implement the rate change as soon as possible – and by no later than 1 May 2024. You can check whether your employer is one of the 14,000 participating companies on the Living Wage Foundation website.
In a video published on Tuesday 24 October, MoneySavingExpert.com (MSE) founder Martin Lewis announced the new real living wage rates and addressed employers directly, urging them to sign up to the scheme and ensure their workers have at least enough to live off:
The real living wage is different to the national minimum wage
The national minimum wage, or 'national living wage', is NOT covered by this announcement.
At MSE, we don't use the term 'national living wage' because it isn't really a living wage – it's the lowest amount that employees aged 23 or over can legally be paid. This is adjusted every April.
A full-time worker earning the new real living wage will get £3,081 more a year than a worker on the current national minimum wage, according to Living Wage Foundation. In London, they would earn £5,323.50 more than a worker on the national minimum wage.
The national minimum wage will rise in April – but it'll still be lower than the real living wage
The UK Government has said that the national minimum wage will rise to £11 an hour from April 2024 – so £1 an hour less than the new UK real living wage and £2.15 an hour less than the new London real living wage.
The current minimum wage is £10.42 an hour, though rates are lower for younger workers. For the full list of minimum wage rates, see our National minimum wage guide.