The National Minimum Wage and National Living Wage will be increasing from 1 April. The new rates will be:
- £8.91 to £9.50 for those aged 23 and over (the National Living Wage)
- £8.36 to £9.18 for those aged 21 or 22
- £6.56 to £6.83 for those aged 18 to 20
- £4.62 to £4.81 for those aged under 18, no longer of compulsory school age; and
- £4.30 to £4.81 for apprentices under 19, or over 19 and in the first year of the apprenticeship.
Keep up to date with employment law:
Real Living Wage rise: what HR needs to know
Employers warned off the #NaughtyList by Jackie Weaver
Imminent changes to Statutory Sick Pay: what HR needs to know
From April 3, statutory family-friendly payments will increase from £151.97 to £156.66, which covers maternity, adoption, paternity, shared parental and parental bereavement pay.
SSP will also increase from April 6 to £99.35, up from £96.35, along with the Lower Earnings Limit, which increases for the first time in two years to £123 to £120.
These annual changes come as many businesses struggle to keep up with surging costs and higher-than-ever starting salaries, exacerbated by the end of the SSP Rebate scheme, which offered a helping hand to SMEs during the pandemic.
Managers are advised that if they do not meet these requirements, they may be liable for criminal damages and employment tribunal claims.
There is also the reputational damage that comes with being named on a government 'name and shame' list if you fail to meet National Minimum Wage standards.
While this may sound daunting, it is merely a deterrent against malpractice. If you stay up to date with the latest changes, you should be fine.
I’d recommend setting out a calendar for employee birthdays, so you can update their salary accordingly. You also need to make sure that any deductions, such as for uniforms or if you require employees to pay for the cost of Covid testing, don’t take their hourly rate below NMW.
The gender pay gap reporting deadline is also fast approaching, with public-sector employers required to file their reports by March 30th and private-sector employers by the 4th of April.
If you still have gender pay disparity that you are trying to fix, then you can explain that in the report and set out the steps you are taking to address the issues.
Two final changes are coming on the 6th of April. Firstly, the right-to-work checking process is changing for biometric residence card holders, who must now carry out checks via the Home Office online checking service.
New limits on employment statutory redundancy will come into play, meaning redundancy pay is calculated based on weekly pay, length of service and age, if someone has been employed for over two years. This will be capped at £571. HR managers should calculate statutory redundancy payments, based on this new amount.
April 6 is also the first anniversary of the IR35 rule changes, which put responsibility for checking the employment status of a contractor and whether IR35 applies on the employer. Now would be a good time to check your compliance and make any changes needed.
Alan Price is CEO at BrightHR
