Whether you are a permanent employee or working in a temporary role, it’s important to be aware of statutory pay rate changes. For those working in Finance jobs, particularly where payroll is part of your responsibilities, it important to keep up to date with these.
The National Minimum Wage, National Living Wage, statutory sick pay, maternity, adoption, paternity and shared parental pay rates all increased in April 2023, along with tribunal compensation limit increases.
National Living Wage (NLW) and National Minimum Wage (NMW) increases
The NLW applies to those aged 23 and above, and the NMW applies to those between school leaving age and 22 years. The statutory pay rates generally increase each year, which are based on recommendations made by an independent body called the Low Pay Commission.
The new rates will apply from 1 April 2023, and are as follows:
|
Legal age brackets |
Rate from April 2023 |
Increase from 2022 (£) |
Increase from 2022 (per cent) |
|
Ages 23 and over (NLW) |
£10.42 |
£0.92 |
9.7% |
|
Ages 21-22 |
£10.18 |
£1.00 |
10.9% |
|
Ages 18-20 |
£7.49 |
£0.66 |
9.7% |
|
Ages 16-17 |
£5.28 |
£0.47 |
9.7% |
|
Apprentices* |
£5.28 |
£0.47 |
9.7% |
*There are different rates of pay for apprentices depending on your age and what year of your apprenticeship you’re in.
After 1 April, use the information above to check that you’re earning the NLW or NMW at a minimum for your age. Alternatively, the UK government website also offers a handy calculator tool to check this. If you’re working part time or full time, the same national minimum pay rates would apply.
New Statutory Sick Pay rate for 2023
You would generally claim Statutory Sick Pay (SSP) from your employer when you’re too ill to work, and this is paid by your employer for up to 28 weeks. You could receive more sick pay from your employer if they have a sick pay scheme as part of your employment contract.
From 2 April 2023, SSP will rise from £99.35 a week to £109.40 a week. To be eligible for SSP, you must:
- be classed as an employee and have done some work for your employer
- earn an average of at least £123 per week
- have been ill for at least 4 days in a row (including non-working days)
To learn more about SSP, visit the UK government website.
Increase in statutory maternity, paternity, adoption and shared parental pay
The statutory maternity, paternity, adoption and shared parental pay rates are due to increase on 2 April 2023. The rates will increase from £156.66 to £172.48 a week.
To qualify for statutory maternity pay, you need to earn on average at least £123 a week, give the correct notice with proof that you’re pregnant, and have worked for your employer continuously for at least 26 weeks continuing into the ‘qualifying week’ – the 15th week before the expected week of childbirth. View our guide to maternity leave to learn more about maternity leave and pay.
To be eligible for statutory paternity pay, you must be taking time off work to look after a child and be one of the following:
- the father
- the husband or partner of the mother (or adopter)
- the child’s adopter
- the intended parent (if having the baby through surrogacy)
There are extra conditions you need to meet to qualify for pay, which include being employed by your employer up to the date of birth, earning at least £123 a week before tax, providing sufficient notice, and have been continuously employed by your employer for at least 26 weeks up to any day in the ‘qualifying’ week – the 15th week before the baby is due.
You are eligible for statutory adoption pay if:
- you have been continuously employed by your employer for at least 26 weeks up to the day you’ve been matched with a child
- be on your employer’s payroll and earn at least £123 a week in an 8-week period
- give enough notice and have proof of adoption
To qualify for statutory shared parental pay, both parents must share responsibility for the child at birth, and meet work and pay criteria.
Limits on employment rights
Under the Employment Rights (Increase of Limits) Order 2023, the annual increase to tribunal limits came into effect on 6 April 2023, with the key changes being:
- An increase of a ‘week’s pay’ for the calculation of redundancy payments (or basic awards) to £643 (previously £571). You may be entitled to statutory redundancy payments if you are classified as an employee, and you would need to have been working at your current employer for 2 years or more.
- An increase to the limit on compensatory awards for applicable claims at employment tribunals to £105,707 (previously £93,878). This applies to unfair dismissal claims, which may be lower than this maximum amount depending on your situation or circumstances.
Next steps
If you’re currently working in a temporary or permanent role, your employer would prepare for these statutory changes to ensure you’re earning the correct NLW or NMW at a minimum. As a trusted and professional recruitment agency, we ensure that all of our job vacancies reflect the statutory minimum wage rates or higher.
At Tate we are committed to providing a passionate, professional and personal service to all our candidates. If you have any questions about your pay or other statutory pay rates, contact your Tate consultant or your local Tate branch for more information.
