Real living wage

The Real Living Wage (RLW) is an hourly rate calculated by the Living Wage Foundation, which takes into account the actual cost of living in the UK. It is a voluntary rate paid by approximately 15,000 businesses. It’s designed to provide a more accurate measure of the minimum income required for individuals and families to meet their basic needs, rather than just the statutory National Minimum Wage (NMW).

The RLW is updated annually based on research conducted by the Living Wage Foundation, which considers factors such as housing costs, food prices, childcare expenses, and other living expenses. The current rate (as of 2024) is £13.15 per hour in London and £12 per hour outside of London.

The key differences between the RLW and the NMW are:

• The RLW takes into account regional variations in living costs, whereas the NMW is a national minimum wage.
• The RLW is calculated based on research and evidence, rather than just government-set rates.
• The RLW aims to provide a higher standard of living for workers, taking into account factors such as housing costs, food prices, and childcare expenses.

Employers who choose to pay the RLW are committed to ensuring that their employees earn a wage that reflects the actual cost of living in their area. This can help to reduce poverty and income inequality, and promote fairer working conditions for all employees.

In terms of HR and rota management, employers may need to consider adjusting employee salaries or benefits packages to ensure compliance with the RLW. This could involve conducting a thorough review of staffing costs, including overtime payments, bonuses, and other forms of remuneration.

AceRota’s automated rotas can assist employers in adhering to the real living wage by ensuring that all staff are scheduled for a minimum number of hours, thereby guaranteeing them a stable income. This helps prevent fluctuations in earnings and ensures employees receive their rightful pay.