Previously, pay rates for retail assistants aged 23 and over closely aligned to the National Living Wage (NLW), the highest (or ‘adult’) tier of the National Minimum Wage (NMW). However, these new rates surpass the forthcoming uplift to the NLW, which is set to rise by 9.8% to £11.44 an hour on 1 April 2024. Instead, they are more closely aligned with the voluntary living wage (VLW). The VLW is an estimate of the wage needed for a socially acceptable standard of living and is currently estimated to be £12 an hour outside London (£13.15 in London) and is the recommended rate for all workers aged 18 and over.
There are now an estimated 14,300 accredited living wage employers across the UK – up from 12,300 in 2022. The VLW is a key reference point for retailers, despite the relatively low number of accredited employers – at around 400 including employers such as IKEA and Lush. Some retailers commit to match the VLW but do not seek formal accreditation. This might be due to the scheme’s requirement to ensure on-site contractors such as cleaners are also paid the VLW or concerns over its long-term affordability.
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IDR's March 2024 issue of Pay Climate features an article on pay differentials and the labour market in retail. Our Pay Climate service provides exclusive up-to-date analysis of pay awards and other reward measures across the economy. This regular bulletin keeps you and your team at the forefront of pay expertise and trends.
