What Is Living Wage? | HR Glossary | BambooHR
A voluntary pay rate calculated to cover the basic cost of a decent standard of living.
A living wage is an hourly rate set to reflect the real cost of living rather than a statutory floor. It is calculated from the price of essentials such as housing, food, transport and utilities, and is typically higher than the legal minimum wage.
In Ireland, a voluntary living wage figure is published annually by an independent group, and the government has committed to moving the statutory National Minimum Wage towards a national living wage benchmarked at a share of median earnings. The UK operates a similar distinction between the statutory National Living Wage and the voluntary rate promoted by the Living Wage Foundation.
Employers adopt a living wage to strengthen recruitment, reduce turnover and signal fair treatment. It is a commitment rather than a legal requirement, so it should be applied consistently and reviewed each time the benchmark is updated.
