April 2023 saw a number of important employment law changes take place, which charities and third sector organisations should be aware of.
Getting on the wrong side of employment law can be costly and damaging to an organisation's reputation, so it is vital that charities and third sector organisations keep up to date and take specialist advice where necessary.
April is always a busy time of the year for employers and employment law changes, and April 2023 was no different. Here are some of the key changes that took place:
National Minimum Wage
As of 1 April 2023, the National Minimum/Living Wage increased to:
- £10.42 per hour for workers of 23 years and over;
- £10.18 per hour for workers aged between 21-22;
- £7.49 per hour for workers aged between 18-20;
- £5.28 per hour for workers aged between 16-17 (who are not apprentices); and
- £5.28 per hour for those on the apprentice rate.
Failure to comply comes not only with financial risk but also huge reputational damage. In addition to a worker's right to enforce NMW entitlement, HMRC also has enforcement powers (including naming and shaming, financial penalties and criminal offences in some cases).
Statutory payments and limits
There were also increases to statutory payments:
- Statutory maternity or adoption pay increased to £172.48 per week after the first six weeks until the end of ordinary leave from 2 April 2023.
- Statutory paternity pay increased to the lower of £172.48 per week or 90% of average weekly earnings per week for a maximum of two weeks from 2 April 2023.
- Statutory parental bereavement pay increased to the lower of £172.48 per week or 90% of average weekly earnings per week from 2 April 2023.
- Statutory sick pay (SSP) increased to £109.40 per week from 6 April 2023, with the average gross weekly earnings required to qualify for SSP remaining at £123 or more.
As of 6 April 2023, the maximum compensatory award for unfair dismissal increased to £105,707. The maximum amount of a week's pay, used to calculate statutory redundancy payments and the basic award in some tribunal awards, increased to £643. These figures apply to all dismissals taking effect on or after 6 April 2023.
Compensation for discrimination
In addition to above changes, the Presidents of the Employment Tribunals (England & Wales) and (Scotland) also announced increases in the Vento guidelines. These guidelines are used to calculate compensation for 'injury to feelings' in discrimination and certain whistleblowing claims. The new bandings, effective from 6 April 2023, are as follows:
- Lower band (less serious cases): £1,100 to £11,200;
- Middle band: £11,200 to £33,700; and
- Upper band (the most serious cases): £33,700 to £56,200.
The injury to feelings award is in addition to any financial compensation, and the total compensation is potentially uncapped. Unlike unfair dismissal cases, there is no minimum length of service required to bring a claim for discrimination (and indeed discrimination claims can be brought by job applicants and ex-employees).
Employers should be aware that employment tribunal decisions are available online to anyone, and so there is also the potential for significant reputational risk arising from an adverse decision.
For more coverage of recent and upcoming employment law developments, please see our Employment Team's latest quarterly newsletter.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.