As you turn the page on your calendar into April, here’s a summary of what you need to know.
Of those new limits referred to below, probably one of the most notable ones in the current economic climate will be the weekly pay figure used for statutory redundancy calculations which increases from 6 April.
As ever, do get in touch if we can help answer any questions you may have.
IR35 for the private sector
Changes to IR35 in the private sector come into force on 6 April having been delayed for 12 months due to the Covid-19 pandemic. In summary, if IR35 apply the new rules shift responsibility for determining the status of a contractor and the liability for deducting tax and NIC to the hiring organisation.
Read our recent blog for more information, including whether your business will be caught by the new rules.
Increase in Compensation Limits and a Week’s Pay
Also from 6 April 2021, new increased compensation limits for employment tribunal claims will come into force.
The cap on unfair dismissal compensatory awards increases to £89,493 (it is currently £88,519).
The weekly pay figure used to calculate the statutory redundancy payment and the basic award in unfair dismissal cases increases to £544 (it is currently £538).
Changes to the National Minimum Wage
From 6 April the National Living Wage will be extended to 23 and 24 year olds for the first time.
The new hourly rates will be:
- Age 23 or over (national living wage rate): £8.91 (up 2.2% from £8.72)
- Age 21 to 22: £8.36 (up 2% from £8.20)
- Age 18 to 20: £6.56 (up 1.7% from £6.45)
- Age 16 to 17: £4.62 (up 1.5% from £4.55)
- Apprentice rate: £4.30 (up 3.6% from £4.15)
The offset for accommodation which can be deducted from an employee’s pay will also increase to £8.36 per week (up 2% from £8.20).
Statutory Pay Rates Increase
Statutory sick pay will increase from £95.85 to £96.35 per week from 6 April 2021.
Statutory maternity, paternity, shared parental and adoption pay will increase from £151.20 to £151.97 per week from 4 April 2021.
Please get in touch if you have any questions regarding the issues discussed in this article.
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