Many UK employees and workers will receive a pay rise while they enjoy the Easter holidays, since their statutory entitlements are set to increase over the bank holiday weekend (from 1 April 2018) or with effect from the new tax year 2018/19, namely 6 April 2018. Jennifer Sole, with assistance from our intern Temujin Erdene-Ochir, summarised the changes:
National Minimum Wage:
The increase in the National Minimum Wage over Easter will be the largest increase over the last decade for 18-20 and 21-24 year olds, with a rise of 4.7% and 5.4% respectively. Workers over 25 also receive a 4.7% increase. From 1 April 2018, employers are required to pay the following rates:
Above 25: £7.83.
Age 21-24: £7.38.
Age 18-20: £5.90.
Under 18: £4.20.
Statutory Maternity, Paternity, Adoption and Shared Parental Pay:
The statutory rates that employees receive for maternity pay, paternity pay, adoption pay and shared parental pay will be £145.18 per week from 1 April 2018.
Statutory Sick Pay:
For those employees entitled to receive it, statutory sick pay will be £92.05 from 6 April 2018.
Tax thresholds and rates:
There will be “pay rises” as result of changes to tax thresholds on 6 April 2018, too:
- Employees’ personal allowance (that is, the amount that can be earned per year tax-free) will increase to £11,850.
- The UK basic tax rate starting from will be 20% on annual earnings above the PAYE tax threshold and up to £34,500.
- The UK higher tax rate starting will be 40% on annual earnings from £34,501 to £150,000.
- The UK additional tax rate from will be 45% on annual earnings above £150,000.
Employment Tribunal Limits:
These will also increase on 6 April 2018, as follows:
- 1 week’s pay for calculating redundancy/unfair dismissal basic award: £508.
- Basic award for unfair dismissal/statutory redundancy payment: £15,240.
- Compensatory award for capped unfair dismissal claim: £83,682.