Real Living Wage explained – how much it is and how it differs to the National Living Wage

The tariffs paid under the Real Living Wage have been increased from today.

The Living Wage Foundation, which operates the program, confirmed that hourly wages for employees working for a registered company will increase by 40p an hour.

Read more: What is the Difference Between Real Living Wage and National Living Wage?

This means these workers will see a welcome increase in their wages, as electricity and gas costs rise, and await the increase in social security contributions from April next year.

But you may have a few questions about the Real Living Wage. What is it? How much does it pay its workers? Which companies are registered? And how does it differ from the National Living Wage and National Minimum Wage? Here is everything we know

What is the real livelihood?

The Real Living Wage is a minimum wage employers should pay their employees that is independently calculated and takes into account the cost of living, such as: B. the cost of household electricity bills, groceries, and more.

The movement started as Citizens UK and they began advocating a living wage when it came up at meetings in London.

They managed to convince the Mayor of London, Ken Livingstone, to stand up for the campaign and get some businesses and businesses in the capital to take it over.

The movement became the Living Wage Foundation in 2011 and that same year the organization established the first UK Real Living Wage.

What is the real livelihood?

The Real Living Wage is currently set at £ 9.90 per hour across the UK, with the exception of workers in London where it is now £ 11.05 per hour.

The reason for the difference lies in the higher cost of living in the capital, so these workers are equally rewarded.

The previous Real Living Wage was set at £ 9.50 per hour but is reviewed annually and updated accordingly.

Do employers have to give their employees the Real Living Wage?

Employers are not required by law to pay their employees the Real Living Wage. However, in order to be accredited by the Living Wage Foundation, they must adhere to the tariffs.

The reason employers were not forced to pay the Real Living Wage is because the government did not accept the recommendations of the Living Wage Foundation.

Instead, in 2016 the Conservatives introduced their own “subsistence wage” called the National Living Wage – which is believed to be similar to the Real Living Wage but which differs due to a number of factors. The National Living Wage is required by law and must be borne by employers as a minimum.

Which employers have adopted the Real Living Wage rates?

More than 9,000 UK businesses, businesses and organizations have adopted the Real Living Wage as the basic pay rate for their employees.

Read more: What is the Real Living Wage and which companies are involved?

These include insurance company Aviva, Everton Football Club and Queen Mary, the University of London.

During the coronavirus pandemic, a whopping 3,000 UK companies joined the program, which means some companies weren’t too concerned about the economic shock from Covid-19.

What is the difference between the national living wage, the national minimum wage and the real living wage?

The main difference between the National Living Wage, National Minimum Wage, and Real Living Wage is that the first two are set by law while the last is not.

Employers are therefore obliged by parliamentary law to pay their employees at least the national living wage or the national minimum wage.

What they pay depends on the age of the employee. If they are between the school leaving age and 22 years of age, they must receive at least the national minimum wage, while from 23 years of age they receive the national living wage.

However, the goal is to move 21- and 22-year-olds from the National Minimum Wage to the National Living Wage by the middle of the decade.

In addition, the other difference between them is the methodology of calculating the rates. The Real Living Wage is charged independently of the cost of living. For example, it takes into account the ancillary household costs.

The National Living Wage is calculated based on median income and is a recommendation from the Low Pay Commission.

The Low Wage Commission also makes recommendations on the national minimum wage after consulting with companies and companies.

What are the national minimum wage and the national living wage?

The current living wage rate is almost a pound an hour lower than the real living wage for people aged 23 and over.

For this group, the National Living Wage is currently £ 8.91 per hour but is expected to increase to £ 9.50 per hour by April 2022.

The national minimum wage for 21-22 year olds is £ 8.36 an hour and is set to rise to £ 9.18 an hour next April.

For people aged 18-20 it is £ 6.56 per hour but is expected to increase to £ 6.83 per hour. That means the increase is more than 25p per hour worked.

For those under the age of 18, the national minimum wage is fixed at £ 4.62 an hour, with an increase to £ 4.81 an hour next April.

Will the government adopt the Real Living Wage set by the Living Wage Foundation?

It doesn’t look likely that the government will adopt the Real Living Wage set by the Living Wage Foundation.

But starting next April, with the increase in the national living wage, they will come close to the new real living wage rate.

It remains to be seen whether the tariff set by the Living Wage Foundation will be required by law in the future.


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