What is the National Minimum Wage, National Living Wage and real Living Wage?
Understand what the National Minimum Wage, National Living Wage, and real Living Wage are and the differences between them.
Understanding the National Minimum Wage, National Living Wage, and the real Living Wage is important for every employer. These are separate wage rates, and each one has different rules and requirements.
What is the National Minimum Wage?
The National Minimum Wage is the legal minimum hourly rate that almost all workers in the UK must be paid. The correct rate depends on the worker’s age and apprenticeship status. It is set by the UK government and is updated each April.
For the current National Minimum Wage rates, see National Minimum Wage and National Living Wage rates.
What is the National Living Wage?
The National Living Wage is the legal minimum hourly rate for workers aged 21 and over in the UK. It is set by the UK government and is updated each April.
For the current National Living Wage rate, see National Minimum Wage and National Living Wage rates.
What is the real Living Wage?
The real Living Wage is a voluntary hourly rate set by the Living Wage Foundation. It is based on the cost of living, not the legal minimum wage.
For employers, paying the real Living Wage is a choice that goes beyond statutory requirements. It can support fair pay, help with recruitment and retention, and strengthen your reputation as a responsible employer. The real Living Wage rate is updated by the Living Wage Foundation each autumn.
For further information, see Real Living Wage Accreditation: What is it and how to apply.
Important distinction between the National Living Wage and the real Living Wage
The National Living Wage is the statutory minimum. It differs from the real Living Wage, which is voluntary, based on living costs, and set by the Living Wage Foundation rather than the government.