Definition
A voluntary hourly pay rate set by the Living Wage Foundation specifically for London, reflecting the higher cost of living in the capital compared to the rest of the UK.
UK Context
The London Living Wage is supported by the Greater London Authority and is a key element of the Mayor of London's social policy. Many London borough councils are accredited and require contractors to pay the London rate. The rate is calculated using the Minimum Income Standard methodology adapted for London's higher costs, particularly housing and transport.
Best Practices
- Apply the London Living Wage to all employees who work primarily within the Greater London Authority boundary
- Include the London Living Wage commitment in tender requirements for London-based contracts
- Factor the London rate into budget planning for London operations, including annual increases
- Use Living Wage accreditation as a recruitment advantage in London's competitive labour market
Frequently Asked Questions
What is the current London Living Wage?
The London Living Wage for 2025/26 is 13.85 pounds per hour. This is set by the Living Wage Foundation and updated annually, usually in November. It is higher than both the UK-wide Real Living Wage (12.60 pounds) and the statutory National Living Wage (12.21 pounds).
Who qualifies as a London-based employee?
The Living Wage Foundation considers employees to be London-based if they spend the majority of their working time within the Greater London Authority boundary. For hybrid workers, this is typically determined by their primary work location rather than their home address.
Is the London Living Wage legally required?
No, the London Living Wage is voluntary. The only statutory minimum is the National Living Wage. However, some London borough councils and public sector organisations include London Living Wage requirements in their procurement contracts.