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<strong>Employment Law Updates – April 2023</strong>

In today’s rapidly changing legal landscape, staying up-to-date with the latest developments in employment law is more important than ever for employers. It can be easy to miss information about the latest changes; however, the ViewHR team are here to provide employers with an update on the key recent changes…

National Minimum / Living Wage

From the 1st April 2023 the National Minimum and Living Wage rates are increasing. The new rates are now:

  • National Living Wage (23 Years Old and Over): £10.42
  • 21-22 Year Old Rate: £10.18
  • 18-20 Year Old Rate: £7.49
  • 16-17 Year Old Rate: £5.28
  • Apprentice Rate: £5.28

What does this mean for employers?

Firstly, employers should check individuals rate of pay to determine whether they are below the new statutory minimums, and then increase rates to match legislation. To keep good levels of communication, write to staff explaining the change and why it has occurred; this will highlight to employees that changes are legislative and not company discretion. Moreover, it is also worth investigating which staff are now close to the new minimum – it would be a good time to review their pay also.

Next, notify your payroll teams of any staff effected by the change. Employers should also take note of employee’s birthdays, where they are under 23 years old, as in time that will affect their rate of pay.

Finally, as employees see an increase in their reward for contribution it may be an ideal time to update your ‘total reward statements’. Reward statements communicate the total value of all elements of reward (salary, bonus, benefits including pension and shares) to each employee. If employees don’t understand what they are receiving, there is little chance they will appreciate it.

Statutory Sickness Pay (SSP)

From 2nd April 2023, statutory sickness pay will increase to £109.40 per week from £99.35 (2022).

What does this mean for employers?

Review your sickness absence policies and procedures, do they mention the specific rate of pay for sickness? If they do, update the document and inform staff (including payroll) of the change. Should individuals currently be on SSP, ensure their rate of pay is updated.

Family Friendly Payments

From 2nd April 2023, statutory maternity, adoption, paternity and shared parental pay rises from £156.66 to £172.48 a week.

What does this mean for employers?

Again, review your policies and procedures, do they mention the specific amount of pay? Update documents to reflect the change. Importantly, if any individuals are in receipt of the payments their pay should be updated in the next payroll run.

Statutory Redundancy Pay

New limits on employment statutory redundancy pay will come into force on 6 April 2023.

Employers that dismiss employees for redundancy must pay those with two years’ service an amount based on the employee’s weekly pay, length of service and age.

Labour Market Statistics and Unemployment Rates

Being aware of the labour market and unemployment rates is useful for employers, it allows them to develop impactful recruitment strategies for the job market.

Research undertaken by the Charted Institute of Personnel and Development (CIPD) has found ‘fifty-seven per cent of all employers currently have hard-to-fill vacancies, and 29% anticipate significant problems in filling hard-to-fill vacancies over the next six months’. The Office for National Statistics adds to this thought; in its March 23 update, although vacancies have decreased, they remain above pre-pandemic levels at 1,124,000 vacancies in December 22 – February 23. The unemployment rate (individuals without a job) has remained largely unchanged at an estimated rate of 3.7%.

The data suggests that the labour market remains historically tight with just 1.1 unemployed person per vacancy.

What does this mean for employers?

Employers should aim to retain their staff the best they can. Review your total reward system, and potentially undertake stay interviews to determine how best to retain individuals. On the recruitment front, employers should aim to be proactive, extending the vacancy reach, but also create a strong employer brand; this will also aid in efforts to recruit.

The ViewHR team are experienced in undertaking HR audits to ensure that employers are up-to-date will all aspects of employment law.  If you would like to find out more, please get in touch today for an initial discussion.