New Tax Year Brings Changes to Finances
As always, April brings a whole host of changes that employers should be aware of.
April 1st 2023 - Minimum Wage Rise
The National Living Wage for workers over the age of 23 is going up by 9.7 per cent and the National Minimum Wage for workers aged between 21 and 22 will increase by 10.9 per cent.
The exact amount of the increases will be:
- National Living Wage for over-23s - going up from £9.50 to £10.42 an hour
- National Minimum Wage for those aged 21-22 - going up from £9.18 to £10.18 an hour
- National Minimum Wage for 18 to 20-year-olds - going up from £6.83 to £7.49 an hour
- National Minimum Wage for under-18s - going up from £4.81 to £5.28 an hour
- The Apprentice rate - going up from £4.81 to £5.28 an hour
- Accommodation offset going up from £8.70 to £9.10
Statutory Rate Changes - Benefits and Pensions
This year will see a 10.1 per cent rise to all payments including benefits and the State Pension.
For example, the full rate of the new State Pension is going up from £185.15 to £203.85.
The rate for 2023/24 for statutory maternity (SMP), paternity (SPP), adoption (SAP), parental bereavement (SPBP) and shared parental pay (ShPP) will increase from £156.66 to £172.48 per week. Additionally, the rate of statutory sick pay (SSP) is also set to increase from £99.35 to £109.40 per week.
The minimum weekly amount an individual must earn to be entitled to these payments will remain at £123.
Increase in Tribunal Compensation and Redundancy Pay Limits
One the most significant differences employers will face will be the potential cost of making employees redundant and in the value of claims being brought to an employment tribunal for unfair dismissal. This is because the upper cap on a week’s pay for statutory redundancy payments will increase on 6th April 2023.
- Compensatory Award – £105,707 (previously £93,878)
- A week’s pay for redundancy payments – £643 (previously £571)
As these changes take effect from 6 April 2023, anyone made redundant after this date will be entitled to a higher payment.
Get Expert Legal Advice
Phone or email Coles Miller employment solicitor Hugh Reid for specialist legal advice on employment contracts, disciplinary procedures, terminating contracts of employment and making workers and employees redundant. He is based at our Poole town centre head office.
