Home Business Services Statutory Employment Payments On The Rise

Statutory Employment Payments On The Rise

Gemma Sherbourne, employment lawyer and senior associate at LCF Law

Every April the rates and limits change for statutory employment payments. This includes the amounts employees receive by way of statutory sick pay, redundancy pay, maternity/paternity pay and minimum wage, as well as the maximum amounts payable following successful Employment Tribunal claims.

Gemma Sherbourne, employment lawyer and senior associate at LCF Law, explained: “From the 1st April this year, there are annual increases across the board, including in relation to the maximum Employment Tribunal compensatory award, which this year is increasing from £89,493 to £93,878.

“However, it’s important to understand that this doesn’t mean that everyone winning a claim will automatically see an increase in the amount of any compensatory award made. The compensatory award does what it says on the tin – it compensates the employee for their losses – it is not designed to be punitive or to give the employee a windfall.

“As a result, given the current strong jobs market, particularly in skills-shortage areas, then despite the maximum award available being increased, it is entirely possible that we will see a decrease in the level of compensatory awards in Employment Tribunals if employees are more readily able to secure alternative employment.”

LCF Law’s employment team has significant expertise in dealing with Employment Tribunal claims and advising employers on the best ways to avoid them.

Gemma added: “Win, lose or draw, Employment Tribunals can be time-consuming and expensive to defend. It therefore remains sensible to take advice to ensure that a company’s policies and procedures remain fit for purpose, and to minimise the risk of claims.”

On 1 April 2022 the following increases will take place:

  • Cap on a week’s pay (for redundancy and other statutory purposes) £544 to £571
  • Maximum basic award/ statutory redundancy pay £16,320 to £17,130
    Maximum compensatory award £89,493 to £93,878
  • Statutory maternity pay / shared parental leave/ adoption pay prescribed rate/ paternity pay £151.97 to £156.66
  • Statutory sick pay £96.35 to £99.35
  • National Living Wage (23 +) £8.91 to £9.50
  • National Minimum Wage (21-22) £8.36 to £9.18
  • National Minimum Wage (18-20) £6.56 to £6.83
  • National Minimum Wage (16-17) £4.62 to £4.81
  • National Minimum Wage (Apprentice rate) £4.30 to £4.81
  • Injury to feelings – discrimination claims Lower band:£900 – £9,100 to £990 – £9,900, Middle band: £9,100 – £27,400 to £9,900 – £29,600, Upper band: £27,400 – £45,600 to £29,600 – £49,300