Increase in Statutory Payments
March 15, 2022
National Minimum Wage and National Living Wage
There are a number of statutory rate increases that come into effect in April including the National Minimum Wage (NMW) and National Living Wage (NLW) as shown in the table below.
| Age | From 1st April 2021 | From 1st April 2022 | % increase |
| 23 and over (NLW) | £8.91 | £9.50 | 6.6% |
| 21-22 | £8.36 | £9.18 | 9.8% |
| 18-20 | £6.56 | £6.83 | 4.1% |
| 16-17 | £4.62 | £4.81 | 4.1% |
| Apprentices under 19 (or over 19 and in the first year of the apprenticeship) | £4.30 | £4.81 | 11.9% |
Are you aware of the changes that apply to your team members? With relatively small gaps between the bandings for NMW/NLW it is so important to keep a track of important anniversaries that move individuals from one band to the next. Check birthdays and key apprenticeship dates to make sure you keep every employee on the right pay rate.
Applying the new rates
The table above shows the rates that will apply from 1 April 2022. However any increase is actually due in the “pay reference period” after the increase comes into effect.
Example
If Janine is normally paid on 15th of every month the old rate will apply between 1 and 15 April. The new pay rate will take effect at the start of the new pay reference period on 16 April.
Many employees will not be aware of this and will likely be expecting an increase from 1 April. Our advice is always to be open and transparent with your employees. Taking the time to explain the situation to those affected will help to manage their expectations effectively. It will also minimise the risk of accusations of failure to pay correctly.
Statutory Sick Pay
The rate of Statutory Sick Pay (SSP) is set to increase to £99.35 from the current rate of £96.35. The Lower Earnings Limit is also set to rise from £120 to £123.
National Insurance (NI) Increase
National Insurance will increase by 1.25% from 6 April. HMRC will ask all employers to add the following comment to payslips between 6 April 2022 and 5 April 2022: “1.25% uplift in NICs funds NHS, health and social care”. The wording is optional but may help to explain the mandatory government increase.
Our recommendation is to advise your employees in advance of the change to allow them some time to prepare.
Family friendly Statutory Payments
Family friendly payments will increase from 3rd April from £151.97 to £156.66. This includes:
- shared parental pay
- maternity pay
- adoption pay
- paternity pay
- parental bereavement pay
If you’re unsure how to apply any of the changes outlined, we can help. Get in touch here: Totally HR (totally-hr.co.uk)
