In the 2022 Spring Statement, the Chancellor Rishi Sunak announced a series of changes affecting the employment landscape from increases in statutory rates and limits through to an increase in National Insurance Contributions. This article provides an update on these changes.
Statutory rates and limits
From 1 April 2022, the National Living Wage has been increased as follows:
- For workers aged 23 and over: £9.50
- For workers aged 21-22: £9.18
- For workers aged 18-20: £6.83
- For workers aged 16-17 and apprentices: £4.81
From 3 April 2022, statutory maternity, adoption, paternity and shared parental pay has increased to £156.66 or 90% of the employee’s average weekly earnings if this is less than the statutory rate.
From 6 April 2022, the Statutory Sick Pay rate has increased to £99.35 per week. There is also no longer an entitlement to Statutory Sick Pay from day one of an employee’s incapacity for work where absence is related to COVID-19.
If an employee is dismissed on or after 6 April 2022, the ‘week’s pay’ that is used to calculate statutory redundancy pay has increased to £571. The maximum compensation for unfair dismissal has increased to £93,878 or 52 weeks’ pay, whichever is lower.
The range of awards for injury to feelings in cases of discrimination or detriment for whistleblowing, commonly known as the “Vento bands”, have increased as of 6 April 2022 to:
- £990 to £9,900 for the lower band
- £9,900 to £26,600 for the middle band
- £26,600 to £49,300 for the upper band
National Insurance Contributions
The Chancellor confirmed an increase of 1.25% in National Insurance Contributions from 1 April 2022. The increases applies to classes one (employee and employer) and four (self-employed) on the main and higher tax rate bands.
The rate changes always serve as a good reminder for employers to make sure that their processes and employment documents are up-to-date and in line with the statutory minimum requirements. If you have any questions or wish to discuss the contents of this update further, please email the Grant Saw Employment team or contact us on 020 8858 6971.