National Minimum Wage and Living Wage
Since the 1st of April, the National Living Wage (NLW) for workers over the age of 25 has increased to £8.21 per hour. Additionally, the National Minimum Wage (NMW) has increased for those under 25, as follows:
- Workers aged 21 – 24: £7.70 per hour
- Workers aged 18 – 20: £6.15 per hour
- Workers under the age of 18 (who are no longer of compulsory school age): £4.20 per hour
Employers should also continue to take into account deductions from payments that can reduce an employee’s NMW calculation, for example, expenditures that are connected with employment or expenditures that are for the employers use and benefit.
Changes to statutory payments have also taken effect. The weekly rate an eligible employee/worker can receive for statutory maternity, paternity, adoption and shared parental pay increased to £148.68 on April 7th and statutory sick pay increased to £94.25 per week on April 6th. Where policies detail specific amounts for statutory payments, these will require updating.
In addition, on April 6th changes to statutory redundancy payments came into force. The weekly pay cap (which was £508.00) increased to £525.00.
Employers now have to rethink their pay slip process as since April 6th, both ‘employees’ and ‘workers’ are entitled to receive itemised pay statements.
Payslips now also need to include the total number of hours worked, where this influences pay, meaning payroll and HR departments need to work in unison to ensure relevant staff receive their payslips in accordance with these new requirements.
Employers’ approach to pensions will need adjusting in 2019 as the minimum auto-enrolment contributions increased from April 6th.
Employers and workers now need to contribute 3% and 5% of an employee’s pre-tax salary respectively each month, making the overall contribution at least 8%, when it was previously a minimum of 5%.
Gender Pay Gap Reporting
Since April 4th, private and voluntary sector organisations who employ over 250 employees are now required to publish their second gender pay gap report. The report must be published on the organisation’s website somewhere that is publicly accessible, and also submitted to the governments reporting website.
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