Andreja Okamgba, HR Consultant, looks at the statutory rate increases from 1 April 2022.
National minimum wage (NMW)
From 1 April 2022, the NMW and living wage increased as follows:
- £9.50 an hour (23 years old and over, also called National Living Wage), up from £8.91
- £9.18 an hour (21 – 22 years old), up from £8.36
- £6.83 an hour (18 – 20 years old), up from £6.56
- £4.81 an hour (ages under 18 but above compulsory school leaving age), up from £4.62
- £4.81 an hour (under 18 years old and apprenticeships), up from £4.30
Given the significant increases, employers may find themselves paying a higher than ever percentage of their workforce at the minimum rates. While this brings about many management challenges, it also means that businesses need to ensure they don’t fall foul of the many requirements of the National Minimum Wage Regulations 2015. The majority of employers who are penalised and named and shamed for not paying the appropriate rates, are often caught out on one of the technicalities such as deducting cost of the uniform, which is a very complex area. Case law must be understood in addition to HMRC guidance, so we urge any employers who have staff paid at the NMW rates to seek advice and ensure they are compliant.
Family-related statutory pay
Statutory maternity pay (SMP), paternity (SPP), adoption (SAP) and shared parental pay (SSPP) increased to £156.66 per week, or 90% of the employee’s average earnings, whichever is lower (up from £151.97). This change is effective from 3 April 2022. Maternity allowance will also increase to £156.66 per week from 11 April 2022.
Statutory redundancy pay and unfair dismissal
From 6 April 2022, the week’s pay limit for calculating the basic unfair dismissal award and statutory redundancy payments will increase from £544 to £571.
Statutory sick pay (SSP)
From 11 April 2022, SSP will increase to £99.50 per week (up from £96.35). The requirement for fit-to-work notes to be signed in ink will also be removed, enabling notes to be completed digitally.
If you have any questions regarding the statutory rate increases, please contact Andreja Okamgba.