LIVING WAGE RATE INCREASES ANNOUNCED AS CAMPAIGNERS CALL FOR MORE BUSINESSES TO GO BEYOND LEGAL MINIMUMS
The Living Wage Foundation has today, Monday 2nd November, announced that there are now more than 2,000 accredited Living Wage employers across the UK. This doubles the number of accredited businesses from November 2014.
Accredited Living Wage employers will pay their staff at least the new voluntary Living Wage rate of £8.25 per hour, rising from £7.85; significantly higher than the national minimum wage of £6.70 per hour, and the new minimum wage premium for over 25s of £7.20 per hour that will come into force across the UK in April 2016.
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, at least the Living Wage.
Mayor of London, Boris Johnson, will announce the new London Living Wage rate at 9am, Monday 2nd November. The London Living Wage rate is expected to follow a similar upward trend to the national rate, and is already set above the anticipated 2020 target for the minimum wage premium for over 25s of £9.00 per hour.
The new rate, which the Living Wage Foundation encourages responsible businesses to pay, is calculated independently and based on the cost of living.
Sarah Vero, director Living Wage Foundation said: "Today we are celebrating those 2,000 responsible businesses that are voluntarily paying the Living Wage to their staff. These employers are not waiting for Government to tell them what to do; their actions are helping to end the injustice that is in-work poverty in the UK now. The Living Wage campaign is growing at pace. Today more UK businesses are announcing their Living Wage accreditation including national retailer Richer Sounds, Lloyds Banking Group and Unilever. They join a growing list of organisations ranging from FTSE 100 companies to independent businesses, SMEs and third sector employers who all share our belief that work should be the surest way out of poverty. The Living Wage is good for people and for business."
Tim Munden, HR Director, Unilever UK said: "As a company committed to making sustainable living commonplace we believe it is right to raise the floor on wages. That is why we have been committed to paying our UK employees at least a living wage for some time. We are therefore delighted to take this next natural step in gaining accreditation from the Living Wage Foundation; it underlines our commitment to a living wage approach across our supply chain and it will ensure that hundreds more people working with us will be paid the Living Wage by the end of next year."
The Living Wage announcement today comes in tandem with research released by KPMG, a principal partner of the Living Wage Foundation, which details the number of workers across the UK earning less than a Living Wage, as well as breaking down the areas across the country where low pay remains prevalent and highlighting the sectors paying the lowest rates of pay across the UK.
Neil Jameson, director, Citizens UK said: "Citizens UK member communities have been acting on this issue for well over a decade to champion the Living Wage and encourage those businesses we believe can, to pay their staff enough to live on. Whilst huge gains have been made with increased numbers of organisations signing up, the fact remains that nearly 6 million workers, that's 23% of the UK's working population, earn less than a Living Wage.
"Where are some of the UK's biggest names on the issue of low pay? Companies such as BT, EDF and even John Lewis have yet to accredit, despite others in their sectors leading the way and showing it is possible.
"Life on less than the Living Wage is better described as survival; when living becomes the challenge of trying to exist from one pay day to the next, what room does that leave for family life, for faith or for learning? That's why today we are launching the Living Wage People's Movement, with thousands more local people getting involved and championing the Living Wage as the right way to reward staff."
Frances O'Grady, TUC general secretary 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. Joining a union is the best way for workers to win decent wages they can actually live on."
The Living Wage Foundation has launched an online interactive map as part of the Living Wage People's Movement, detailing for the first time, all the accredited businesses and their branches that pay their staff at least the Living Wage, so consumers and businesses can easily search for a Living Wage accredited employer to do business with or buy from. The map and materials to help Living Wage supporters are available at www.livingwagemovement.org.
What about the Government's national living wage?
In July 2015 the Chancellor of the Exchequer announced that the UK Government will introduce a compulsory 'national living wage'. This new government rate is a minimum wage premium rate for staff over 25 years old. It will be introduced from April 2016 and the rate will be £7.20 per hour. The rate is separate to the Living Wage rate calculated by the Living Wage Foundation."¯ The government rate is based on median earnings while the Living Wage Foundation rate is calculated according to the cost of living."¯
The National Minimum Wage
(including the 'national living wage')
The Living Wage
- The legal minimum an employee can earn in an hour
- Employers break the law if they fail to pay this rate
- A voluntary rate that employers commit to pay in order to go above and beyond
- The Living Wage Employer Mark is a sign of best practice
- The 'national living wage' rate will be £7.20 an hour for the whole of the UK
- The current UK Living Wage is £8.25 an hour
- The current London Living Wage is £9.15 an hour* to be increased & announced later today [Monday 2nd November 09:00am].
- This will increase each year, with the aim of reaching 60% of the median wage across the country by 2020 (this would mean around £9 an hour but the Low Pay Commission will consider what the market can bear)
- This will increase in line with the cost of living with increases announced in Living Wage Week every year
- Different rates apply depending on the age of the employee. The 'national living wage' is for over 25s only
- The Living Wage is the same for all employees over the age of 18
- Set by the Low Pay Commission
- Set by the Living Wage Foundation
- Based on an estimation of what the market can bear
- Based on the cost of living
- The rates are the same right across the UK
- There is a separate rate for London to reflect the higher cost of living in the Capital