Each year, at the beginning of April, the National Minimum Wage rates and the statutory rates and limits of Employment Tribunal awards are updated. This year’s changes have now been announced, so employers can start to make preparations before the changes take effect.
2018/19 Employment Rates & Limits
As of 1 April 2018, the National Minimum Wage rates set out below will apply:
- National Living Wage (workers aged 25 and over) will be £7.83
- Standard Adult Rate (workers aged between 21 and 24) will be £7.38
- Development Rate (workers aged between 18 and 20) will be £5.90
- Young Workers Rate (workers aged under 18 but above the compulsory school age who are not apprentices) will be £4.20
- The rate for apprentices will be £3.70.
As of 6 April 2018, the limit on a week’s pay, which is used to calculate statutory redundancy payments and the basic award in unfair dismissal claims, will increase from £489 to £508. This means that the maximum payment an employee would be entitled to for either a basic award or a statutory redundancy payment would go up from £14,670 to £15,240. The maximum compensatory award in unfair dismissal claims has also increased from £80,541 to £83,682.
There will also be changes to the statutory payments made to employees that are off work. Statutory sick pay will increase from £89.35 to £92.05 per week and the statutory pay for those off on maternity, paternity, adoption and shared parental leave will increase from £140.98 to £145.18 per week.
A further change which was to be implemented as of 6 April 2018, was that the childcare voucher schemes run by employers on a ‘salary sacrifice’ basis was going to be closed to new applicants. Following an announcement by the Government on 14th March 2018 this cut-off date is now delayed until October 2018. However, those who have already joined this type of scheme prior to October 2018 will be able to continue with it. For those employees not already receiving childcare vouchers a new scheme has been set up to allow parents to access tax free childcare from the Government.
How Nelsons Can Help
For further information or to comment on this article, please contact our employment law specialists on 0800 0241 976 or contact us via our online form.