The new tax year saw some key changes for employment rates, including the introduction of the national living wage and steady increases across the board for compensatory awards. The rate changes took effect between the 1st and 6th April and some of the rates will change again mid-way through the financial year.
These changes and their relevant dates are outlined here to bring you up to date.
| Compensation Limits | 2015-2016 | 2016-2017 |
| Maximum Basic Award / Statutory Redundancy Payment | £14,250 | £14,370 |
| Maximum Unfair Dismissal Compensatory Award | £78,335 or 52 weeks' pay [1] | £78,962 or 52 weeks' pay [1] |
| Additional Award (26-52 weeks' pay [2]) | £12,350 – £24,700 | £12,454 – £24,908 |
| Maximum Week's Pay (for basic award and statutory redundancy payment) | £475 | £479 |
| Highest Possible Award in an Ordinary Unfair Dismissal Claim | £92,585 | £93,332 |
| National Minimum and National Living Wage [3] | ||
| 1 April – 30 September 2016 | 1 October 2016 – 31 March 2017 | |
| Age 25+ | £7.20 | £7.20 |
| Age 21-24 | £6.70 | £6.95 |
| Age 18-20 | £5.30 | £5.55 |
| Age 16-17 | £3.87 | £4.00 |
| Apprentice [4] | £3.30 | £3.40 |
| Statutory Payments | Weekly Rate from 5 April 2015 (unchanged) |
| Statutory Sick Pay | £88.45 |
| Maximum Entitlement 28 weeks | £2,476.60 |
| Statutory Maternity Pay ("SMP") (unchanged) | |
| First 6 Weeks | 90% of average weekly earnings [5] |
| Remaining Weeks | The lesser of 90% of average weekly earnings or £139.58 |
| Statutory Adoption Pay | The lesser of 90% of average weekly earnings or £139.58 |
| Statutory Paternity Pay | The lesser of 90% of average weekly earnings or £139.58 |
| Shared Parental Pay | The lesser of 90% of average weekly earnings or £139.58 |
[1] The cap on the compensatory award is the lower of the
statutory maximum or 52 weeks' pay for any dismissals which
take effect on or after 29 July 2013.
[2] An additional award can be made where the employer has
failed to reinstates or re-engage the employee where an order has
been made to that effect.
[3] The National Living Wage for workers aged 25 and over is
in force from 1 April 2016 is mandatory and must
be paid in the same way as the National Minimum Wage. It is not
increasing on 1 October 2016 and any new increase to the National
Living Wage and National Minimum Wage are planned to take effect
from April 2017.
[4] This rate is for apprentices under 19 or those in their
first year.
[5] Average weekly earnings are calculated over the period of
8 weeks ending with the fifteenth week before the EWC.
Disclaimer
The material contained in this article is of the nature of general comment only and does not give advice on any particular matter. Recipients should not act on the basis of the information in this e-update without taking appropriate professional advice upon their own particular circumstances.
