National Minimum Wage rates, Statutory Pay rates, and Compensation limits for employees were changed in April 2022.

National Minimum Wage & National Living Wage changes in 2022

Effective from 1st April 2022

UK National Living Wage

The National Living Wage in the UK for employees and workers aged 23 and over is £9.50 per hour.
The previous rate was £8.91 per hour, this is an increase of 59p per hour, which is 6.6%.

Minimum Wage for 21-year-olds

Employees and workers aged 21 to 22 inclusive: £9.18 per hour.
The previous rate was £8.36 per hour; this is an increase of 82p per hour, which is 9.8%

Minimum Wage for 18-year-olds

Employees and workers aged 18-20 inclusive: £6.83 per hour.
The previous rate was £6.56 per hour, this is an increase of 27pper hour, which is 4.1%.

Minimum Wage for 16-17-year-olds

Employees and workers under 18, but above compulsory school leaving age: £4.81 per hour.
The previous rate was £4.62 per hour, this is an increase of 19p per hour, which is 4.1%.

National Minimum Wage for Apprentices

Apprentices aged under 19, or aged 19 and over but have not completed first year of their apprenticeship : £4.81 per hour
The previous rate was £4.62 per hour, this is an increase of 19p per hour, which is 4.1%

Changes to Statutory Pay for Parents in 2022

Effective from 3rd April 2022

Statutory Maternity Pay

Eligibility: The employee must have been continuously employed for 26 weeks or more by the end of the 15th week before the baby is due (this is known as the expected week of childbirth) and be earning, on average, more than £123.00 per week during the 8 weeks prior to the “qualifying week.” Proper notice in writing and confirmation of the pregnancy via a MATB1 form must also be provided.

Statutory maternity leave lasts for 52 weeks (unless the employee gives notice to end the leave early) and maternity pay starts at the same time as the maternity leave with payments due at the following rates:

  • 90% of the employee’s average weekly earnings for the first 6 weeks of maternity leave
  • £156.66 per week or 90% of average weekly earnings, whichever is lower, for the remaining 33 weeks of maternity leave
  • Nil pay for the remaining 13 weeks of maternity leave.

Statutory Adoption Pay

Eligibility: The employees planning to adopt a child, they must have been continuously employed for 26 weeks or more before being matched with a child and be earning, on average, more than £123.00 per week during the eight weeks prior to the match. Proper notice in writing and proof of the adoption must also be provided.

Statutory adoption leave lasts for 52 weeks (unless the employee gives notice to end the leave early) and adoption pay starts at the same time as the adoption leave with payments due at the following rates:

  • 90% of the employee’s average weekly earnings for the first 6 weeks of adoption leave
  • £156.66 per week or 90% of average weekly earnings, whichever is lower, for the remaining 33 weeks of adoption leave
  • Nil pay for the remaining 13 weeks of adoption leave.

Statutory Paternity Pay

£156.66 per week or 90% of average weekly earnings, whichever is lower

Statutory Shared Parental Pay

£156.66 per week or 90% of average weekly earnings, whichever is lower

Statutory Parental Bereavement Pay

If an employee faces the tragic situation that their child dies, the employee has a statutory entitlement to time off, subject to eligibility criteria. During this absence, they are entitled to be paid £156.66 per week or 90% of average weekly earnings, whichever is lower.

Maternity Allowance

A benefit for employees who cannot get statutory maternity pay. An employee may have insufficient service to qualify for statutory maternity pay or their earnings may be less than the lower earnings limit for national insurance contributions. Maternity allowance is a weekly benefit that Jobcentre Plus pays directly to entitled individuals. Maternity allowance is payable for a maximum period of 39 weeks.

The new rate is £156.66 (or 90% of their average weekly earnings if this figure is less than £156.66)

Category Changes to Statutory Sick Pay (SSP), Redundancy and Compensation in 2022

Effective from 6th April 2022

Statutory Sick Pay

Statutory Sick Pay (SSP) is pay given to employees by their employers if they are too sick to work and fulfil their duties and it must be paid to workers and employees, providing that they meet eligibility requirements.
If an employee is too ill to work, SSP can be paid for up to 28 weeks subject to eligibility criteria and where the absence is longer than 7 days in duration, a Fit Note is provided.

Employees are paid a minimum of £99.35 a week, and it is paid for the ‘qualifying days’ an employee normally works. You can calculate statutory sick pay relatively easily, in that you take the weekly rate of £99.35 and divide this by the number of qualifying days in a week. The first three days of any absence are usually classified as waiting days so SSP is not payable until day 4 of absence.

Statutory Redundancy Payment

If an employee is made redundant and has at least 2 years of service with the employer, they will be entitled to a statutory redundancy payment. The amount due is calculated using a formula that considers the employees age and length of service at the effective date of redundancy and their level of earnings which is capped.

The maximum amount of a week’s pay used to calculate statutory redundancy payment
£571

Statutory guarantee payment for layoff and short time

Statutory guarantee pay is payable to employees who are not provided with work by their employer on a day they would normally work under their contract of employment in specific circumstances and is usually associated with employees being placed on lay-off or short-time working. It is payable at the rate of £31 per day (or actual pay if this is less)– a maximum of £155 for five days’ pay in any three-month period.

Maximum basic award for unfair dismissal

If an employee has worked for an employer for at least two years, when the employer terminates their employment, they need to have a fair reason for ending the employment contract. Each case will be considered on the facts but fair reasons will include: capability, conduct, there being a legal reason why employment cannot continue (eg entitlement to work in the UK), redundancy or some other substantial reason.
If the dismissal is found to be unfair the employee will be entitled to up to £17,130 – 30 weeks’ pay subject to the limit on a week’s pay). The precise amount will be calculated using a formula that considers the employee’s age, length of service and earnings.

Maximum compensatory award for unfair dismissal

Claimants can submit a schedule of loss which evidences their losses because of their dismissal. The maximum that may be awarded is £93,878. However, the compensatory award is unlimited for certain automatically unfair dismissals, for example, health and safety or whistleblowing.

Failure to allow the right to be accompanied

Employees have the right to be accompanied to formal meetings with their employer by a work colleague or a trade union representative. If an employee is prevented from exercising this right, a tribunal may award up to £1,142 which represents two weeks’ pay capped at the statutory amount.

Failure to give a written statement of particulars to an employee

Employees are entitled to a written statement of particulars, a document outlining the main terms and conditions of employment, on or before their first day of employment. Failing to provide this reflects badly upon the employer and could result in a tribunal awarding between £1,142 or £2,284 which represents two or four weeks’ pay capped at the statutory amount.

If you need help with making your business compliant to Government implemented changes, get in touch with the team at MAD-HR today.