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Employers should ensure they have implemented increases to their employees pay following changes that came into effect on 1 April 2020.

The National Living Wage and the National Minimum Wage have been increased for all ages and are as follows:  

  • For workers aged 21 to 24 – £8.20 per hour (an increase of 6.5%),
  • For workers aged 18 to 20 (the development rate) – £6.45 per hour (an increase of 4.9%)
  • For workers under 18 but above compulsory school age (young workers) – £4.55 per hour (an increase of 4.6%)
  • For apprentices – £4.15 per hour (an increase of 6.4%).

The National Living Wage increases from £8.21 to £8.72 an increase of 6.2%.

The recommended increase for the accommodation offset takes it to £8.20 a day or £57.40 a week (an increase of 8.6%).

Please also be aware of changes to the following payments:  

  • Statutory maternity, paternity and adoption pay increases to £151.20 per week.
  • Statutory sick pay increases to £95.85 per week.
  • The maximum amount of a week’s pay for calculating statutory redundancy pay increases from £525 per week to £538. The largest possible statutory redundancy payment or basic award will be £16,140 (up from £15,750).

Deductions

HMRC are focusing on deductions and will be looking at further action if workers on minimum wages have additional deductions, except accommodation offset, that will bring them below minimum wage. This will be irrelevant of signed consent. 

Statutory Sick Pay Relief Package

There is a Statutory Sick Pay Relief Package, which is applicable to UK employers with up to 250 employees on 28 February 2020.

It provides a refund of Statutory Sick Pay – up to two weeks of SSP per eligible employee, which will be refunded for sickness (with effect from 13 March).

Employers will not need evidence but do need to keep a record of sick days as a result of Covid-19, which includes self-isolation. The mechanism of how businesses will claim is still to be announced.

Holiday pay changes

As of 6 April 2020, instead of looking back 12 weeks, employers need to calculate the average over a 52-week period.

Unpaid weeks are still excluded, so counting back into previous years maybe required (capped at reviewing 104 weeks data). If this amount of data is not available due to unpaid weeks etc, then the average can be used.

For NEW WORKERS – if they haven’t worked 52 weeks, they should use what pay data is available right back to their start date. For example, if a worker has been working with their employer for 14 weeks then takes leave, the employer should use the 14 weeks’ worth of data that is available.

ACAS has published new guidance on carrying over holiday as a result of coronavirus.