As we approach the end of the 2024/25 tax year, it also the time of year when various statutory employment payments are increased. So this month we’re giving a quick round up of the key rates raises you need to be aware of. Don’t worry…we’ll be back talking about all the developments with the Employment Rights Bill soon enough!
National Minimum Wage: From 1 April 2025, the National Living Wage will increase from £11.44 to £12.21 per hour for workers aged 21 and over. Those aged 18-20 will see a significant jump from £8.60 to £10.00 per hour, while the rate for 16-17-year-olds and apprentices will increase from £6.40 to £7.55.
Redundancy Payments. For dismissals occurring after 6 April 2025, the cap on a week’s pay for redundancy calculations will increase from £700 to £719
Tribunal Awards. The limit on compensatory awards for unfair dismissal will increase to £118,223, although it remains subject to a secondary limit of 12 months’ gross pay where that is a lower figure.
Statutory Sick Pay: From 6 April 2025, the weekly rate will increase from £116.75 to £118.75. Those earning below the Lower Earnings Limit (LEL) per week (currently £123 but due to increase to £125 in April) are not eligible to receive SSP at present. However, the Employment Rights Bill (sorry…had to mention it somewhere) proposes to remove this requirement, so that those earning below the LEL would still be entitled to receive either the flat rate of SSP or 80% of their average weekly earnings, whichever is lower The Bill also proposes the removal of the three waiting days, making SSP payable from the first day of sickness on each occasion.
Family Leave. From 6 April 2025, the flat rate for statutory maternity pay, statutory adoption pay, statutory paternity pay, statutory shared parental pay and statutory parental bereavement pay will increase from £184.03 to £187.18 per week (or 90% of the employee’s average weekly earnings, whichever is lower).
Neonatal Care Leave and Pay: Eligible families with babies in neonatal care will be entitled to up to 12 weeks of leave and pay, at a similar rate of £187.18 per week.
National Insurance Contributions: The combination of Employers’ NICs rising from 13.8% to 15%, and the threshold for liability dropping from £9,100 to £5,000, will mean a significant increase in National Insurance liabilities. However, the Employment Allowance will rise from £5,000 to £10,500, providing some relief for smaller businesses.