Boost for pay and allowances

  • Date: 17 March 2020

EMPLOYEES will receive boosts to key areas such as leave arrangements and holiday pay under new employment law changes.

From 5th April, statutory pay for maternity, paternity, shared parental, adoption, maternity allowance and bereavement leave will increase from £148.68 per week to £151.20

From 6th April, statutory sick pay increases from £94.25 per week to £95.85.

The National Insurance contribution threshold will also rise on 6th April. Below this lower earnings limit employees are not entitled to SMP, SPP, SAP, SSPP and SSP, but remain entitled to maternity allowance. It is currently £118 and will increase to £120.

Holiday pay

The method to calculate holiday pay for workers with no fixed hours or for those whose pay varies according to work carried out, will change from an average taken over a 12-week period to a 52-week period.

From 6th April, practices will be required to make calculations based on the previous 52 weeks where a worker has worked and received pay. They should disregard any weeks not worked or where no pay was received.

If the worker has been employed for less than 52 weeks, then the average should be based on weeks worked.

This new legislation does not cover holiday pay for an employee’s normal working week where pay does not vary. So in cases where overtime has been worked, it is still the case that the average pay should be based over a ‘representative period’. However, as cases progress to tribunal, it may be that the definition of a ‘representative period’ is eventually regarded as 52 weeks.

Bereavement leave

A new period of paid leave for parents who have lost a child will be introduced in April.

Bereavement leave will be two weeks’ paid leave for the loss of a child under the age of 18 or a stillbirth after 24 weeks.

Employees will require 26 weeks’ continuous service in order to qualify. The leave can be taken as a single block or as two separate weeks but needs to be taken within 56 weeks of the bereavement.

Parental bereavement pay will be paid for the two weeks at a rate of £151.20 per week.

This page was correct at the time of publication. Any guidance is intended as general guidance for members only. If you are a member and need specific advice relating to your own circumstances, please contact one of our advisers.

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