Guide to Becoming a Living Wage Employer

Your people

Being a Living Wage employer is good for your employees, your business and society. Becoming an accredited Living Wage employer shows your commitment to an ethical benchmark of responsible pay. Our guide shares information from the Living Wage Foundation on the benefits of becoming a Living Wage Employer and the steps to getting accredited.

What’s the Living Wage?

It’s an hourly rate set independently by the Living Wage Foundation, updated annually and calculated according to the basic cost of living in the UK. It’s voluntarily paid by over 14,000 businesses who believe their employees deserve pay that meets their everyday needs. The UK living wage is £12 per hour, and the London living wage is £13.15 per hour, significantly higher than the statutory minimum wage (these rates are correct as of April 2024). The calculation for an annual living wage salary is: living wage x hours worked per week x 52

Why should you pay it?

The living wage provides a benchmark for responsible employers who choose to pay their employees a wage that meets the basic cost of living. There are over 10,000 accredited living wage employers, including half of the FTSE 100.

It benefits your employees:

  • They don’t have to worry about affording the basics
  • They can build up savings
  • They’ll have more time to spend with their families and friends

And your business:

  • It enhances your reputation as an employer
  • It increases staff retention rates
  • It improves managers – employee relationships

You might face some challenges around affordability, maintaining pay differentiation and the potential for living wage rate to rise each year.

The accreditation journey

To get ready:

  • Start paying the current living wage to everyone you directly employ
  • Plan to pay your contractors the current living wage
  • Complete the Living Wage Foundation’s application form

To persuade your senior team:

  • Tell them about the business benefits
  • Use the Living Wage Foundation’s case studies showcasing the positive impacts

To get accredited:

  • Costs start at £60 a year and are based on the size of your business
  • If you already pay all your directly employed and contracted employees the living wage, your accreditation license will be processed in ten working days
  • If your contractors can’t pay the living wage, you must commit to renewing contracts at the living wage

…and once you’re accredited:

You’ll appear on the Living Wage Foundation’s map so consumers, prospective employees, students and funders can easily see who pays a wage that meets the cost of living. And you can display the Living Wage Employer logo to recognise your commitment.

Communication is key! Make sure you’re shouting about being a living wage employer by…

  • Displaying the living wage employer logo on your website, your email signature and your marketing materials
  • Putting the living wage plaque you’ll receive in a prominent place
  • Telling everyone you do business with and encouraging them to pay the living wage too
  • Using your social media channels to show your commitment and encourage other businesses to do the same


Updated in January 2024 by Heart of the City. We’ve created these resources for individual SMEs to use. None of our content is to be adapted, reused or repurposed for commercial use.