April 2024 Wage & NI Updates
12 November 2024
The National Living Wage and the National Minimum Wage (for 18-20 year olds) will increase in April, rising to £12.21 per hour (currently £11.44) and £10.00 per hour (currently £8.60) respectively.
Additionally, the National Insurance (NI) rate paid by employers will increase from 13.8% to 15%. The National Insurance ‘secondary threshold’—the level at which businesses start paying NI on each employee’s salary—will drop from £9,100 a year to £5,000.
These are the only changes for employers and employees from the recent budget. There are also amendments to the Employment Rights Bill that are currently progressing through the House of Commons. Below is an overview of these amendments.
Employment Rights Bill:
Consultation and Implementation:
The Government plans to start consulting about reforms in 2025 and anticipates that most changes will take effect no earlier than 2026, following a substantial transition period.
Unfair Dismissal:
The employment manifesto pledges to make unfair dismissal a day-one right. Currently, employees must have at least two years of service to bring a claim for unfair dismissal.
Fire and Rehire:
The practice known as "fire and rehire" (dismissal and re-engagement) will be prohibited. The Bill will automatically deem it unfair to dismiss an employee if the principal reason for dismissal is either:
The employer sought to vary the employee’s contract, and the employee did not agree to the variation; or
To enable the employer to re-engage the employee, or employ another person, under a varied contract to carry out substantially the same duties.
Harassment:
Employers will be required to take all reasonable steps to prevent sexual harassment. The Bill allows the Government to specify what steps will be regarded as “reasonable.” It introduces liability for third-party harassment and mandates employers to take reasonable steps to prevent it. Third parties include anyone who is not the employer or an employee.
A disclosure about sexual harassment will become a "protected disclosure," entitling whistleblowers to protection under the current regime.
Zero Hours Contracts:
Employers must offer guaranteed hours to zero-hours workers and those on low guaranteed hours who regularly work more than those hours. Guaranteed hours should reflect regular work over a reference period. Employers should provide details of the days and times they will make work available. Compensation will be payable for shifts canceled or changed at short notice.
Flexible Working:
Since April 2024, the right to request flexible working has been a day-one right for all employees. Employers must respond within two months and consult with employees before refusing a request. Refusal must be reasonable, and employers must explain their grounds for refusal.
Statutory Sick Pay (SSP):
Currently, SSP is only provided from the fourth day of sickness if the employee meets the lower earnings threshold (£123 per week). The Bill removes both the waiting period and the earnings limit, making SSP available from the first day of illness. The Government will consult on the SSP rate for those earning below the threshold.
Parental and Paternity Leave:
The Bill will remove the qualifying service requirement for paternity leave (currently 26 weeks) and unpaid parental leave (currently one year). Both will become day-one rights.
Bereavement Leave:
Provisions on parental bereavement leave will extend beyond parents to create a general right to bereavement leave. Conditions related to relationships will be confirmed later. Leave will remain at two weeks following the death of a child, and one week for other bereavements.
At entreprenör, we understand that staying informed and compliant is crucial. Should you need any assistance in understanding how these changes may apply to your specific circumstances, including assessing cost impacts or revising contracts, please do not hesitate to reach out to our team.