Government reforms (1): April Changes – Are you ready?

1 April 2022

Increase in National Living and Minimum Wage

The new rates are as follows:

• Age 23 plus: National Living Wage increase from £8.91 to £9.50 per hour;
• Age 21 to 23 (inclusive): increase from £8.36 to £9.18 per hour;
• Age 18 to 20 (inclusive): increase from £6.56 to £6.83 per hour;
• Age 16 or 17 (inclusive): increase from £4.62 to £4.81 per hour; and
• Apprentice rate: increase from £4.30 to £4.81 per hour.

5 April 2022

Right-to-work checks

From 30 March 2020, the rules requiring employers to conduct right-to-work checks in person were temporarily lifted as a result of the COVID-19 pandemic. See our updates on this here.  From this date, employers have been able to carry out right-to-work checks via video and using scanned documentation as opposed to originals.

These temporary measures are due to end on 5 April 2022. The government has not yet confirmed what the expectation will be in future, but employers would be wise to assume that right-to-work checks may need to take place in person again.

Gender Pay Gap reporting

Organisations with 250 or more employees are required to publish their gender pay gap report by 4th April 2022 (30th March 2022 for public sector employers).

Reports must be published on the company website as well as on the Government’s gender pay gap portal. Employers have the option of providing an explanation and outlining the steps that are being taken to address the pay gap.

6 April 2022

Statutory sick pay (SSP) to increase

SSP will increase from £96.35 to £99.35 per week.

National Insurance contributions to rise

On 6 April 2022, National Insurance contributions for employers and employees will rise by 1.25%. This increase will fund health and social care and will be replaced in April 2023 by a separate health and social care levy (at which time, National Insurance contributions will revert to current levels).

Increases in Statutory Redundancy Pay, other statutory payments and Tribunal awards

The usual annual increase in statutory payments and Tribunal awards includes the:

• maximum limit for a statutory week’s pay (used to calculate statutory redundancy payments and the basic award for unfair dismissal) from £544 to £571.
• maximum compensatory award for unfair dismissal from £89,493 to £93,878. (Although the award is unlimited for certain automatically unfair dismissals, for example, health and safety or whistleblowing).
• maximum basic award for unfair dismissal and statutory redundancy payment from £16,320 to £17,130. That makes the maximum total basic and compensatory awards for unfair dismissal £111,008 (generally subject to a limit of 52 weeks’ actual pay).
• minimum basic award for certain automatically unfair dismissals from £6,634 to £6,959 (i.e. those due to health and safety, employee representative, trade union, or occupational pension trustee reasons).

The new rates take effect where the ‘appropriate date’ for the course of action, such as the date of termination in an unfair dismissal claim, falls on or after 6 April 2022.

11 April 2022

Increases to the statutory rates for maternity (SMP), paternity (SPP), shared parental pay (SSPP), adoption (SAP) and sick pay (SSP)

Statutory rates for everything other than sick pay will increase from £151.97 to £156.66 per week per week or 90% of average earnings if lower.

Lower earnings limit

The amount of the weekly lower earnings limit that applies to National Insurance contributions (below which employees are not entitled to SMP, SPP, SAP, SSPP and SSP) is increasing from £120 to £123).