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Your client must keep up to date with important anniversaries, such as birthdays and apprentices moving into their second year. 16% of those ‘name and shamed’ by the government in February 2024 for failing to pay NMW/NLW gave the reason as failing to increase pay in line with entitlement.
Your client should also be reminded of when to apply the increase (the next “pay reference period” after the increase). This is the period within which pay is calculated. For example, if Penelope gets paid monthly on the 15th, the old rate applies until the pay reference period beginning on 16 April. Therefore, Penelope will get the old rate between April 1 and 15. To avoid any employee grumbles, it would be good to recommend to your client that they explain this to their staff.
Family friendly statutory payments
From 6 April 2025 family friendly payments increase to £187.18 from £184.03 (including shared parental, maternity, adoption, paternity, parental bereavement, and for the first time, neonatal care pay). These apply to those away from work on paid family leave, from the date of the increase.
Statutory sick pay (SSP) and the lower earnings limit (LEL)
The LEL will increase from £123 to £125 from 6 April 2025. SSP will increase then from £116.75 to £118.75.
Employer National Insurance Contributions (NIC)
Another change is the increase to NIC by 1.2% from April 2025, raising them from 13.8% to 15%. The threshold from which employers start paying NICs will also reduce from £9,100 to £5,000. It is estimated that this will raise £25billion. or the equivalent of around £800 per employee for each firm.
To support smaller businesses in managing these additional costs, the Employment Allowance will increase from £5,000 to £10,500 and the £100,000 eligibility threshold to access this allowance will be removed, allowing more businesses to benefit.
Time to prepare
April is nearly upon us, and your client needs to act now to make sure they are aware of any workers that are getting a pay rise. As these increases happen on different days in early April, care will need to be taken to ensure everything is correct.
