Key Statutory Pay Changes 2020

Grassroots HR - Key Statutory Pay Changes 2020

Hello, the following newsletter relates to new employment legislation that will be introduced in April 2020. This is one of a series of newsletters we will be sending during March as 2020 sees an unusually large number of changes that will likely impact your business.

This newsletter relates to Statutory Pay Changes being introduced in April. If you have any employees currently earning the National Minimum Wage, a Variation to Contract letter should be issued to reflect their new rate of pay. For information regarding these Variation to Contract letters, please refer to the ‘Next Steps’ at the end of the newsletter.

The other newsletters in this series relate to The Good Work Plan, IR35 and Parental Bereavement Leave.

 

National Living Wage and Minimum Wage

The National Living Wage is payable to workers aged 25 and over. From 1st April it will increase from £8.21 per hour to £8.72 per hour

The National Minimum Wage for workers under 25 will also increase as follows:

  • Workers aged 21 to 24 – from £7.70 to £8.20
  • Workers aged 18 to 20 – from £6.15 to £6.45
  • Workers aged over compulsory school age under 18 – from £4.35 to £4.55
  • Apprentices should be paid £4.15, an increase from £3.90

 

Statutory Maternity Pay (SMP) / Statutory Paternity Pay (SPP) / Shared Parental Pay (ShPP) / Statutory Adoption Pay (SAP)

The current weekly rate of Statutory Maternity Pay (SMP) / Statutory Paternity Pay (SPP) / Shared Parental Pay (ShPP) / Statutory Adoption Pay (SAP), is £148.68, or 90% of the employee’s average weekly earnings if this figure is less than the statutory rate.

The rate of statutory pay is expected to rise to £151.20 from April 2020. The increase normally occurs on the first Sunday in April, which in 2020 is 5 April.

 

Statutory Parental Bereavement Leave (SPBL)

The rate of the new statutory parental bereavement leave will be paid at the lower of £151.20 per week or 90% of average weekly earnings.

 

Statutory Sick Pay (SSP)

The rate of statutory sick pay is also proposed to increase from £94.25 per week to £95.85 per week on 6 April 2020.

 

Next Steps:

For our Clients:

  • Update your Staff Datasheet and confirm the updates to us by email.
    • For Retained Clients we provide the relevant documents as part of our service under your retainer agreement.
    • For PAYG Clients please let us know if you want us to make the updates under your PAYG agreement.
  • Ensure your new rates of pay are communicated to payroll and appropriate staff are provided with a variation to contract letter we will send to you.
  • Update your HR Self-Service platform such as Breathe HR or People HR.
  • Ensure your Payroll department familiarise themselves with the new statutory pay requirements and ensure their processes/calculations and systems are updated accordingly.

 

For Non-Clients:

For those who wish to discuss the changes in more detail, please call 01772 600228 or email office@grassrootshr.co.uk

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