The government has announced increases in the national living and minimum wage rates from April 2017. The new rates will be:
What is the difference between the living wage and the minimum wage?
Since April 2016, the ‘national living wage’ has applied to workers aged 25 or over – this is compulsory and is essentially a premium on top of the national minimum wage for workers in that age group.
There is also a voluntary living wage, set annually by the Living Wage Foundation. Many businesses choose to pay this, but they don’t have to (unless, for example, they have agreed to as part of a tender bid).
The Foundation promotes the wage as the minimum people need to meet the real costs of living, and encourages employers to pay at least that rate. It is possible to become accredited as a Living Wage Employer in Scotland.
The Living Wage Foundation announced amended rates on 31 October 2016 – rising from £8.25 per hour to £8.45 per hour (and from £9.40 to £9.75 in London). The rates apply to all workers over 18.
Employers who claim to pay this living wage are asked to implement the rise as soon as possible, and at least within 6 months (so all employees receive the new rate by 1 May the following year).
The Scottish Government’s Public Sector Pay Policy for Staff Pay Remits also states that every worker whose pay is controlled directly by the Scottish Government should receive the Scottish living wage, which is based on the rate set by the Living Wage Foundation.