A Labour council is due to become the first in the country to offer companies a discount on their business rate if they pay the London living wage today.
Brent council is offering employers a saving of as much as £5,000 if they pay all workers at least £9.15 an hour, which is the living wage rate for London, rather than the national minimum wage for adults of £6.50 an hour.
The council estimates that 30% of its residents earn less than the living wage.
The cost of awarding the discount would be shared between central government (50%), the Greater London Authority (20%) and Brent Council (30%).
The discounts would range from companies with more than 500 employees, which would get a £5,000 reduction on their rates, to firms that employ less than 10 staff, which would get a £250 saving.
The council suggests that up to 200 businesses in Brent could benefit from the scheme.