Almost 400,000 employees are set to receive a pay rise after an increase “real living wage” agreed by thousands of businesses and organisations has been brought forward.
The hourly rates for the living wage are rising by £1 to £10.90 across the UK and by 90p to £11.95 in London.
The rates are higher than the government’s statutory £9.50 an hour for adults, and are paid by more than 11,000 employers accredited by the Living Wage Foundation.
The announcement of the new rates was brought forward in recognition of soaring energy bills and rising food prices during the cost of living crisis, said the foundation.
It comes as Kwasi Kwarteng is set to announce that more than 100,000 people in part-time work could face a benefit cut if they fail to properly look to do more hours.
The chancellor is set to reveal a significant shake-up of Universal Credit, with claimants working up to 15 hours a week on the National Living Wage required to take “active steps” to increase earnings.
The number of real living wage employers has more than doubled in the past two years, with major new names including the Royal Albert Hall, Aston University, and the ExCel Centre, as well as thousands of small businesses.
Katherine Chapman, Living Wage Foundation director, said: “With living costs rising so rapidly, millions are facing an awful ‘heat or eat’ choice this winter – that’s why a real living wage is more vital than ever.”
She added: “Today’s new rates will provide hundreds of thousands of workers and their families with greater security and stability during these incredibly difficult times.”
Union leader called on Liz Truss’s government to follow the foundation and increase basic rates of pay. “Low-paid workers are crying out for help,” said Unison general secretary Christina McAnea.
“The Government must follow the foundation’s lead and bring forward an increase to the national minimum wage without delay. Rather than boosting bankers’ bonuses, the government should concentrate on those feeling genuine financial pain.”
Ms Truss has indicated that her government is willing to lift the cap on bankers’ bonuses in the City of London, despite widespread outrage among MPs, unions and economists at the proposal.
GMB official Rachel Harrison said: “The fact tens of thousands of NHS workers, school staff, local government workers and care staff aren’t even paid a living wage should be a badge of national shame.
She added: “What kind of society do we want to live in? Do we want to make sure those who look after us can feed their children and keep a roof over their head? Or do we want to let already wealthy bankers enjoy uncontrolled bonuses in some vague bid to ‘boost the City’?”
There are now also 39 “living hours” employers – including Aviva and West Bromwich Building Society – going beyond the real living wage to provide a guaranteed minimum of 16 hours work a week and a month’s notice of shift patterns.
