Thousands of UK workers' pay to rise as living wage increases

More than 210,000 workers in Britain are to receive a pay rise after the charity behind the living wage increased the national minimum hourly rate by 30p to £9.30.

The Living Wage Foundation, which sets the voluntary measure, said London workers’ basic hourly rate will also rise, by 20p to £10.75, compared with the government’s “national living wage” of £8.21 for workers aged 25 years or older.

The charity said the difference between its own living wage and the government minimum will be more than £2,000 a year nationally and almost £5,000 a year in London.

This year, the Living Wage Foundation has accredited about 1,500 employers, taking the overall total to just under 6,000. Employers that have joined the initiative include the FTSE 100 insurer Hiscox, Crystal Palace football club, Leeds Building Society, City airport in London and Newcastle University.

In September, Capita, the outsourcing company that operates the London congestion charge and collects the BBC licence fee, became the latest to gain accreditation. It said it would adopt the rate across its UK business, resulting in a pay rise for 6,000 staff.

The rise comes as both main political parties compete to offer higher minimum wages. At the Tory party conference in October, Sajid Javid said he would increase the minimum rate for workers over the age of 25 to £10.50 by 2024 and reduce the age level at which workers qualify to 21 by the same date.

The shadow chancellor, John McDonnell, has pledged to introduce £10 an hour as a minimum rate immediately, which he said would rise with living costs. McDonnell said it would mean “everybody over 16 years of age will be earning comfortably more than £10.50 an hour by 2024”.

Katherine Chapman, the director of the Living Wage Foundation, said good businesses knew the living wage “means happier, healthier and more motivated workers”.

She welcomed announcements by Cardiff and Salford councils to build “living wage cities”, with Cardiff planning to double the number of workers receiving the real living wage to nearly 50,000.

Chapman said analysis by the consultancy IHS Markit consultancy for KPMG found 5.2 million workers were paid less than the charity’s living wage, which is the lowest figure for seven years.

Writing in the Guardian, the archbishop of York, John Sentamu, said levels of in-work poverty had become widespread and employers should take the lead by increasing wage levels.

He said: “When we read that schools in the east of England are installing community fridges to provide food for families who otherwise would not be able to pay for it, we know there’s something seriously wrong.”

The West Ham United vice-chairman, Karren Brady, said: “West Ham has paid the London living wage to all staff since 2015 and has been an accredited employer for two years now and it is something we’re hugely proud of.

“The London living wage helps to ensure that we can support our staff at a time when we know the cost of living is rising across the country, not just in the capital. As such, we made a decision in 2015 to extend the initiative to staff based outside of London, in our retail stores across Essex.”