Around a quarter of a million workers in the UK are set to experience a pay rise thanks to the increase in the real Living Wage, paid by nearly 7,000 employers around the country.
This is everything you need to know.
How much is the increase?
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The real Living Wage rates for 2020/21 have been announced by the Living Wage Foundation.
For those around the UK, the new rate will rise to £9.50, which is a 20p boost, and for those living in London, the rate will increase to £10.85, which is a 10p increase.
The UK real Living Wage rate is 78p per hour higher than the government Minimum Wage (for over 25s) and the London Living Wage is £2.13 per hour higher.
Currently the government Minimum Wage is set at £8.20 and is set for those aged under 25. The National Living Wage is set at £8.72 and is for those over 25.
A full time worker being paid the new £9.50 real Living Wage rate will receive over £1,500 in additional wages, compared to the current government minimum.
For London workers, this increases to over £4,000.
Who will get the increase?
The increase will be applied to those who are being paid the voluntary real Living Wage by their employer.
Since the start of the Covid-19 pandemic, more than 800 new employers have become accredited with the Living Wage Foundation.
Around 250,000 people around the UK are set to experience the pay boost.
There are a total number of 6,935 accredited real Living Wage paying employers, and includes the likes of Ikea, Aviva, Nationwide, Oxfam, Nestle and many more.
You can see if your employer is an accredited real Living Wage employer by using the Living Wage Foundation website.
What has the Living Wage Foundation said?
Laura Gardiner, Living Wage Foundation Director, said: “It’s an incredibly challenging time for us all, but today’s new Living Wage rates will give a boost to hundreds of thousands of UK workers, including thousands of key and essential workers like cleaners, care workers, and delivery drivers who have kept our economy going.
“Since the start of the pandemic employers have continued to sign up to a real Living Wage. During Living Wage Week it’s right that we celebrate those employers that have done right by workers and families, providing them with much needed security and stability even when times are hard.
“These are the employers that will allow us to recover and rebuild from this crisis.”
When will the increase happen?
Employers are encouraged to implement the new Living Wage as soon as possible, however there is a deadline of within six months.
“All employees should receive the new rate by 9 May the following year,” the Living Wage Foundation states.
What’s the difference between the real Living Wage, the National Living Wage and Minimum Wage?
“The real Living Wage is an hourly rate of pay set independently and updated annually (not the UK government’s National Living Wage),” the Living Wage Foundation explains.
The wage is calculated according to the basic cost of living in the UK, and employers can opt to pay the real Living Wage on a voluntary basis.
The Living Wage Foundation says that the real Living Wage calculation is made “according to the cost of living, based on a basket of household goods and services”.
The real Living Wage applies to those 18 years and older, and has a separate rate for those who live in London, unlike the government Minimum Wage and the National Living Wage.
According to the Living Wage Foundation, the campaign has impacted over 250,000 employees since 2001, and delivered over £1.3bn extra to some of the lowest paid workers in the UK.