What is the difference between the Real Living Wage and the National Living Wage?

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These two similarly-named rates are often confused, but they serve different purposes and have very different legal status -- understanding the distinction matters for both workers checking their pay and employers considering their wage policy. **The National Living Wage: a legal minimum** The National Living Wage is set by the government based on Low Pay Commission recommendations and is the legally enforceable minimum hourly rate for workers aged 21 and over -- £12.71 for 2026/27. Paying below this rate is illegal and can result in significant penalties for employers. **The Real Living Wage: a voluntary, higher benchmark** The Real Living Wage is calculated independently by the Living Wage Foundation, based on the actual cost of living (covering essentials like housing, food, and other living costs), and is typically set meaningfully higher than the statutory National Living Wage -- there is also a higher rate specifically for London, reflecting the higher cost of living there. Employers voluntarily choose to become accredited Living Wage employers, committing to pay at least this rate. **Age eligibility differs** The National Living Wage's full rate only applies from age 21, with lower statutory rates for younger workers (18-20 and 16-17/apprentice bands) -- the Real Living Wage, by contrast, applies to all workers aged 18 and over among accredited employers, without the tiered reduction for younger adult workers that the statutory minimum has. **No legal requirement to pay the Real Living Wage** Unlike the National Living Wage, there is no legal obligation for employers to pay the Real Living Wage -- it is entirely voluntary, and employers who commit to it do so as an accreditation demonstrating a commitment to fair pay, often used as a recruitment and reputation benefit. **Why the gap matters for workers** The gap between the two rates can be meaningful -- someone paid exactly the statutory National Living Wage may be earning notably less than what the Real Living Wage calculation suggests is needed to meet a reasonable standard of living, illustrating why campaigners continue to push for the statutory minimum to rise further, or for more employers to adopt the voluntary Real Living Wage. **Worked example** A 22-year-old working for a Living Wage-accredited employer might earn the Real Living Wage rate (higher than £12.71), while an equivalent worker at a non-accredited employer paying only the legal statutory minimum would earn the lower £12.71 National Living Wage -- both are legal, but represent different levels of pay for comparable work. **How to check if your employer is accredited** The Living Wage Foundation maintains a public list of accredited Living Wage employers -- checking this list, or simply asking your employer directly, can clarify whether you are being paid the voluntary Real Living Wage or just the statutory legal minimum. **Practical tip** When comparing job offers or negotiating pay, check whether a prospective employer is Living Wage accredited, since this can be a meaningful signal about their overall pay philosophy beyond just the specific hourly rate quoted for a role.

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