The Real Living Wage minimum rates have increased by 40p to £9.90 an hour, mainly due to higher fuel costs and rising rent. Rates in London have risen by 20p to £11.05 an hour.
Not to be confused with the National Living Wage, the Real Living Wage is independently calculated based on rising living costs, including food, energy, rent and fuel and applies to workers over the age of 23.
Almost 9,000 employers have signed up to this policy throughout the country, almost 3,000 of them during the pandemic. This is a recommended rate, that is completely optional but is encouraged to ensure that all staff earn a wage that meets the real cost of living and everyday needs.
From Monday 15 November 2021, more than 300,000 workers in the UK will get a pay rise as the foundation behind the voluntary wage has increased the minimum hourly rate. The current legal minimum for workers 23 years old and above currently stands at £8.91 although it is due to rise in April 2022 to £9.50 which was announced in the chancellor’s recent budget announcement. More employers are being encouraged to bridge this gap by signing up to pay their workers the national real wage.
It is estimated that a full-time worker on the voluntary minimum real living wage would take home an extra £1,930 than if they were to be paid the government enforced living wage. In London, as household costs are typically higher this difference could be as much as £4,173.
Below are some commonly asked questions in relation to this:
Do I have to pay the Real Living Wage?
No, there is no legal requirement to pay this rate. However, as employers are struggling more than ever to entice new members of staff, this would be an excellent way to ensure that you are a contender in this candidate lead market.
What is the difference between the Real Living Wage & National Living Wage?
National Living Wage is set by the government, whilst the Real Living Wage is a voluntary scheme that employers can sign up for.
What is the difference between National Living Wage & the National Minimum Wage?
The national living wage applies to workers over the age of 23 and the national minimum wage applies different rates to different ages between 16 and 22.
How do I sign my business up?
You can register to be a Real Wage employer here.
If you have any questions or do not believe that you are paying your workers the correct rate, please contact us today.
For advice or for a free assessment contact us today