Are statutory payment rates and the compensation rate changing in April 2023?

24 March 2023 | Jatinder Tara

On 17 November 2022 the Government in their Autumn Statement confirmed minimum wage rates to commence from April 2023 (Read more here)

What are the National Minimum wage rates from April 2023?

From 1 April 2023 inclusive, the following hourly national minimum wage rates will apply:

National Living wage, workers aged 23 or over: £10.42, increasing from £9.50

Standard adult rate for workers aged 21 to 22: £10.18, increasing from £9.18

Development rate for worker aged 18 to 20: £7.49, increasing from £6.83

Young worker rate who are not apprentices aged 16 to 17: £5.28, increasing from £4.81

Apprentice rate for those under 19 or aged over 19 and in the first year of their apprenticeship £5.28, increasing from £4.81

The daily rate for the accommodation offset will increase by 4.6% from £8.70 to £9.10

The higher rate starts to apply from the next 'pay reference period' after the increase. This means someone's pay might not go up straight away for example if a worker gets paid monthly on the 15th day of each month then the old rate will apply until the worker’s next pay reference period that starts on 16th April when the new rate applies ie pay reference period 16th April to 15th May.

What will be the new rate for statutory sick pay from 6th April 2023?

Statutory sick pay (ssp) will be £109.40, increasing from £99.35, the average gross weekly earnings required to qualify for SSP will remain at £123.00 or more.

What will be the weekly rates for the various types of family leave as from 2nd April 2023?

The weekly rate of statutory maternity, paternity, shared parental, adoption and parental bereavement pay will be £172.48 (increasing from £156.66) or 90% of the employee’s average weekly earnings, whichever is lower.

The average gross weekly earnings required to qualify for all of the above benefits will remain at £123.00 or more.

What are the compensation limits for certain employment tribunal claims and weekly rate of pay to calculate statutory redundancy pay?

From 6 April 2023:

A week's pay (for basic award and redundancy payments) will be £643, increasing from £571 and the relevant date to determine if old or new cap applies is date of termination of contract ie If a worker is made redundant on or after 6 April 2023, the weekly pay is capped at the new rate £643.  Where an employee leaves during a statutory trial period, one should look at when the original contract ended.

The maximum compensatory award for unfair dismissal will be £105,707, increasing from £93,878.

What should employers do?

Employers should make sure that their pay roll systems are updated to reflect the above changes.

The article is for informational and educational purposes only and should not be relied upon as  HR/legal advice. If you require any further assistance, please do not hesitate to contact our free advice line team at 0116 274 9193.


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