What employers need to know: new employment rates in force from April 2024

Every April, the government updates employment- related financial limits. Below are the new rates:

Maximum compensation limits

From 6 April 2024, the following maximum compensation limits are going up:

• The limit on a week’s pay will increase to £700 from its current rate of £643 (used to calculate statutory redundancy and other payments)
• The maximum statutory redundancy payment will increase to £21,000 from its current rate of £19,290 (service is capped at 20 years' service)
• The maximum basic award for unfair dismissal will increase to £21,000 from its current rate of £19,290 and the maximum compensatory award for unfair dismissal will increase to £115,115 from its current rate of £105,707 (this only applies for dismissals that take effect from 6 April 2024)

Increases in SSP, SMP and other statutory benefits

From April 2024, there will also be increases in the statutory amount employees receive if they are off work due to sickness or where they are taking family related leave: 

• From 6 April, statutory sick pay will increase to a weekly payment of £116.75 from its current rate of £109.40
• From 7 April 2024 the statutory rates for maternity, paternity, shared parental, adoption and parental bereavement pay will increase to a weekly payment of £184.03 from its current rate of £172.48
• From 8 April, maternity allowance will increase to £184.03 from its current rate of £172.48

The current lower earnings limit of £123.00 remains unchanged. 

National Minimum Wage and National Living Wage

There are some hefty wage increases employers will need to factor in for low paid staff. From 1 April 2024: 

• The National Living Wage will apply to workers aged 21 and over and the rate is increasing to £11.44 an hour from £10.42
• Those aged between 18-20 will receive £8.60 an hour from £7.49 
• 16 and 17 year olds will receive £6.40 an hour from £5.28
• Apprentices under the age of 19 or in their first year £6.40 an hour, from £5.28
• Accommodation offset increases to £9.99 per day, from £9.10

Employees who carry out domestic work whilst living with their employer will, for the first time, become entitled to the appropriate NMW for their age.

Employers must pay these increased rates starting from the worker’s next pay reference period after the raise.

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