Pay rises for some as "real" Living Wage goes up

The voluntary Living Wage - dubbed the "real Living Wage" - has increased to £10.20 per hour in London and to £8.75 per hour in the rest of the UK.

The announcement by the Living Wage Foundation will give 150,000 UK workers an immediate pay rise. The increase represents a 3.6% rise in the UK and a 4.6% rise in London. So-called "real" Living Wage rates are independently calculated, based on the cost of living in the UK and London.

This voluntary Living Wage is not connected to the Government's compulsory National Minimum Wage (NMW) and the National Living Wage (NLW). The National Living Wage, which was introduced in April last year for workers aged 25 and above, is currently set at £7.50 an hour.

More than 3,600 employers have signed up to the voluntary Living Wage to date. They include Ikea, Google, Nationwide, Aviva and Chelsea and Everton football clubs. This week, Heathrow became the first Living Wage airport, with 3,200 workers set for a pay rise.

However, new research by KPMG has found that one in five UK workers (5.5 million people) are still paid less than the real Living Wage.

Katherine Chapman, director of the Living Wage Foundation, said: "The new living wage rates will bring relief for thousands of UK workers being squeezed by stagnant wages and rising inflation. It's thanks to the leadership of over 3,600 employers across the UK who are committed to paying all their staff, including cleaners and security staff, a real living wage."

Two-thirds of FTSE 100 companies have not joined the voluntary pledge. Dr Wanda Wyporska, executive director of The Equality Trust, said: "It's incredible to see so many of the UK's largest businesses refuse to pay their staff a living wage. It's even more appalling when you consider the average pay for a FTSE 100 boss is now over 300 times that of a minimum wage worker."

Shainaz Firfiray, associate professor of organisation and human resource management at Warwick Business School, said: "While there has been a marginal decrease in the number of people earning less than the living wage, millions are still struggling to make ends meet due to rising living costs and declining wages."

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