Employment law updates from April 2022

April 2022 brings the annual increases to the rates and limits for employment claims, national minimum wage and more. It also brings the gender pay gap reporting deadline. This article sets out the key changes to be aware of.

Employment law rates change every April to reflect increases in the retail index price. As such, several changes will come into force in April 2022 under the provisions of the Employment Rights (Increase of Limits) Order 2022. As well as this, the deadline for gender pay gap reporting is fast approaching. In this article, we summarise the key points to note for employers.

Gender pay gap reporting

Since 2018, organisations that have at least 250 employees have been required to publish annual gender pay gap reports. For private sector companies and voluntary organisations, the deadline for reporting is 4 April 2022. However, public sector employers should be aware that their deadline falls slightly earlier on 30 March 2022.

Organisations should publish their reports both via their own website and also on the reporting portal on the Gov.uk website. The UK Government is due to review the gender pay gap regulations as it is 5 years since they were brought into force so employers should watch out for any developments in this area.

Changes to national minimum wage and other statutory rates of pay

From 1 April 2022, the following changes to national living wage for those aged 23 and over will increase from £8.91 to £9.50 per hour. Changes to the national minimum wage (NMW) for younger workers are as follows:

• for those aged 21 to 22 NMW is increasing from £8.36 to £9.18 per hour;
• for those aged 18 to 20 NMW is increasing from £6.56 to £6.83 per hour;
• for those aged 18 to 20 NMW is increasing from £6.56 to £6.83 per hour;
• for those aged 16 to 17 NMW is increasing from £4.62 to £4.81 per hour; and
• NMW for Apprentices will rise from £4.30 to £4.81 per hour.

As of 3 April 2022, the weekly rates of statutory maternity, adoption, paternity and other parental leave will increase from £151.97 to £156.66. From 6 April 2022, the rate of statutory sick pay will also change from £96.35 to £99.35.

In addition, National Insurance Contributions for both employers and employees will increase by 1.25%. This is to be spent on the NHS and social care.

Organisations should ensure that they are aware of all of these changes and increase their employee’s pay accordingly to comply with statutory rates. It may also be worth checking policies and updating these where rates are specifically referred to.

Rates have risen significantly more than in previous years given the comparatively high retail index price this year. In 2020 and 2021, this was 1.9% and 2.4% respectively - whilst in 2022 this has risen to 4.9%. Employers should ensure that they adequately prepare themselves for these increased costs.

Changes to compensation rates for unfair dismissal

Compensation limits will also be revised in April 2022 for unfair dismissal awards. The new rates apply where an employee’s effective date of termination is on or after 6 April 2022. The changes are as follows:

• the limit on a week’s pay will increase from £544 to £571 – this is used to work out the basic award for unfair dismissal claims, as well as statutory redundancy payments;
• the minimum basic award for certain unfair dismissals (including health and safety dismissals) will increase from £6,634 to £6,959; and
• the maximum compensatory award for an ordinary unfair dismissal will increase from £89,493 to £93,978.

However, it is important to note that whilst the maximum compensatory award has increased, this will be limited to a payment of 52 weeks’ gross pay in circumstances where this amount is lower than the maximum compensatory award.

Duty to provide suitable PPE to workers

6 April 2022 also sees new regulations coming into force which extend the duty on employers to provide suitable personal protective equipment (PPE) to all workers, not just employees where there is a health and safety risk to the worker in the work they carry out for the employer. Employers will also be prohibited from charging workers for any PPE supplied. Employers should ensure that they take note of all of these key dates and comply with the changes coming into force.