Minimum wage
The National Minimum Wage Act 1998 sets out the basic legal framework for the national minimum wage in the UK. The rate of pay will depend on the individuals’ age and whether they are an apprentice.
Rates change every April, the current rates for April 2020 are as follows:
· £8.72 per hour – 25 years and over
· £8.20 per hour – 21 -24 years old
· £6.45 per hour – 18-20 years old
· £4.55 per hour – 16 17 years old
· £4.15 per hour for apprentices under 19, or 19 and over who are in the first year of apprenticeship.
Public holidays and bank holidays
Employees are not automatically entitled to paid time off for bank and public holidays. It is at the employers' discretion whether they allow their staff to take paid leave on these days.
Under the Working Time Regulations (Northern Ireland) 2016 workers have the right to:
· 5.6 weeks paid leave each year, capped at 28 days
· receive payment for untaken statutory leave entitlement on termination of employment.
The entitlement for part-time staff is calculated on a pro-rata basis.
Statutory Paternity Pay (SPP)
SPP is paid for a maximum of 2 weeks to employees who satisfy the qualifying conditions.
· The weekly rate is £151.20 (April 2020) or 90% of the employee’s average weekly earnings, whichever is lower.
Statutory Shared Parental Pay (SHPP)
From April 2020 Statutory Shared Parental Pay will be paid at £151.20 per week or 90% of the average weekly earnings (whichever is lower).
To qualify for SHPP an employee needs to have met the ‘continuity of employment test’ and their partner must meet the ‘employment and earnings test’, just like SPL.
Also, the employee must have earned above the ‘Lower Earnings Limit’ (£120 April 2020) in the eight weeks leading up to and including the 15th week before the child’s due date/matching date and still be employed with the same employer at the start of the first period of SHPP.
Statutory Sick Pay (SSP)
Employers are responsible for the payment of Statutory Sick Pay (SSP) for periods of illness of 4 days or more up to a total of 28 weeks’ absence in any one period of incapacity for work.
The weekly rate of sick pay is reviewed every year at the beginning of April. The current rate of SSP is £95.85 per week (April 2020) for employees with average weekly earnings of £120 or more.
To qualify for SSP you must:
· Be classed as an employee & completed work for an employer
· Earn an average of at least £120 per week
· Have been ill, self-isolating for at least 4 days in a row (including non-working days)
The 4-day qualifying period does not apply to COVID related absences. Companies with less than 250 employees may claim this payment back.
Statutory Maternity Pay (SMP)
To qualify for SMP the average weekly earnings must be at least £120 (April 2020).
The weekly rate is:
First 6 weeks of payment - 90% of employee’s average weekly earnings
Remaining 33 weeks - Pay the lower of 90% of average weekly earnings, or £151.20 (April 2020).
Statutory Adoption Pay (SAP)
To qualify for SAP the average weekly earnings (before tax) must be £120 or more. The SAP rates are reviewed every April and are subject to change.
During their adoption leave, most employees will be eligible for Statutory Adoption Pay (SAP) of up to 39 weeks from their employer.
The rate of SAP is the lesser of a flat rate – as of April 2020, the current rate sits at £151.20 or 90% of their average weekly earnings.
Bereavement
On the 6th April 2020, new legislation was passed for the UK that allowed bereaved parents up to 2 weeks off on full pay.
This legislation does not include Northern Ireland; however, it is suspected that the regulations for employers to grant a period of a minimum of 2 weeks Parental Bereavement Leave will come into force in October.
Pay in Lieu of notice (PILON)
Enforcement of a payment in lieu, without the contractual right or agreement to do so may be viewed as a breach of contract.
The Effective Date of Termination would usually be the last day worked, unless the employee is on a period of Gardening Leave – where they are paid as normal during the notice period, but not required to work it.
In this case, the Effective Date of Termination is normally the date the notice period expires.
Redundancy
Eligibility
To be entitled to receive a statutory redundancy payment, an individual must:
be an employee working under a contract of employment.
have at least two years of continuous service; and
have been dismissed, laid off, or put on short time working (and have a qualifying period of lay off).
When issuing redundancy pay, an employer must provide a statement showing how it was calculated.
Rates
The amount payable is dependent upon age, length of service, and contractual earnings.
Up to the age of 21: half a week’s pay for each completed year of service.
22 to 40 years of age: one week’s pay for each completed year of service.
41+ years of age: one-and-a-half weeks’ pay for each completed year of service.
Limits
The calculation for weekly pay is subject to the statutory limit of £560 (6 April 2020). This is reviewed annually. The maximum number of years that can be considered in a redundancy payment calculation is 20.
**This does not constitute legal advice and specific cases should be discussed with a member of our team.**
For further information and advice about pay-related queries, contact a member of our professional team at Copacetic Business Solutions Ltd.