It’s coming to that time of year again where key changes for April 2021 are being introduced and at Centric HR we are helping organisations to get ahead and prepare for them.
1. Statutory Redundancy Payments
Redundancies continue to be a common theme throughout an array of sectors and industries, continuing to affect the UK economy with the halts and freezes we have seen to everyday life as we knew it.
The cap on a week’s pay for statutory redundancy payments will rise to £544.00 per week for dismissals from 6 April 2021. It is important to account for the updates coming into effect as of April 2021, if they will influence or relate to your proposals over the upcoming months.
2. National Living/Minimum Wage
As of 1 April 2021, the National Living Wage rises to £8.91 per hour, which would previously apply to over 25’s only. However following the implementation set to be rolled out as of 1 April 2021, this bracket will apply to over 23’s. The effects of this are widening the reach and accessibility of the National Living Wage.
The National Minimum Wage will be £8.36 per hour for those aged between 21 and 22; £6.56 for those aged between 18 and 20; £4.62 for those under 18; and £4.30 for apprentices.
3. Family Related and Statutory Sick Pay Entitlements Increased
As of 4 April 2021, the weekly rate of statutory maternity, paternity, adoption, shared parental and parental bereavement pay increases to £151.97
The weekly rate of statutory sick pay increases to £96.35 from 6 April 2021.
4. Gender pay gap reports (private and voluntary sectors)
Private and voluntary sector employers in England, Wales and Scotland with at least 250 employees are required to publish information about the differences in pay and bonuses between men and women in their workforce, based on a ‘snapshot’ date of 5 April each year. Provisions are not yet in force in Northern Ireland.
COVID-19: the government announced a suspension of enforcement measures on gender pay gap reporting for 2019/20, in view of the unprecedented pressures on businesses caused by the pandemic. Employers have until 5 October 2021 to report their 2020/21 figures before enforcement measures are taken but are encouraged to report by the usual reporting deadlines.
5. Extension of IR35 to the private sector
The IR35 rules prevent contractors who are performing similar roles to employees, and working through Personal Service Companies (PCS), from paying less tax and NICs than if they were permanently employed by the client organisation. In April 2017, responsibility for deciding whether contractors’ working in the public sector were caught by IR35 switched from them to their end users, which also became liable for deducting the right amount of tax and NICs.
From 6 April 2021, deciding whether IR35 applies becomes the responsibility of all private sector employers that in a tax year have:
- more than 50 employees
- an annual turnover over £10.2 million
- a balance sheet worth over £5.1 million
COVID-19: The extension of the rules to the private sector was due to take effect from 6 April 2020 but was delayed due to the pandemic.
For further information on key changes for April 2021 and advice please contact us here.