How will rising pay rates affect working parents?

New statutory rates affecting everything from maternity pay to the shared parental pay come in in April. HR expert Kate Palmer outlines what that means for working parents.

Statutory Maternity Pay

 

In April, statutory payments will rise as they do year upon year.

For workers who earn on or around the national minimum wage, this means new wages and contract updates. It also calls for employers to be ready to manage their worker’s pay in line with legal changes.

So when the new rates come in, how will this affect family-related payments and working parents? Here’s what you need to know…

The new minimum wage rates for 2024

From 1st April 2024, the national living wage (NLW) will increase to £11.44 per hour. Currently, only those aged 23 and over can claim this. But from April 2024, 21- and 22-year-olds will be entitled to the NLW for the first time.

For those aged 18 to 20, the minimum rate will increase from £7.49 to £8.60. And for those who fall into the lower brackets, their rate will go up from £5.28 to £6.40. This includes:

 Those over compulsory school age but not yet 18
 Apprentices aged under 19
 Apprentices aged 19 or over and in their first year of apprenticeship

The lowering of the threshold for NLW means more employees could be eligible to receive a higher rate of pay. So, employers will need to check if this includes any of their staff.

New statutory family payments

From 7th April 2024, family leave pay rates are also set to increase from £172.48 to £184.03 per week.

This includes maternity, paternity, adoption, shared parental leave and parental bereavement pay.

So employers will need to know this if any of their eligible staff are planning on taking family leave or are on leave already. Because once these changes take effect, employers will need to start paying this new rate – or 90% of their employee’s wages (whichever option is lower).

To qualify for this statutory pay, employees have to meet certain criteria. One, they have to earn at least the Lower Earnings Limit (£123 a week). They also have to have worked for you for at least 26 weeks continuously by the end of the 15th week before their child’s expected birth. Or, in adoption cases, the week they’re told they have a match.

How employers should manage family-related leave requests

To take any kind of family leave, employees must give you notice. How much notice they have to give depends on the kind of leave they’re taking.

Maternity leave is a day one right for all pregnant employees. They just have to tell their employer about their pregnancy at least 15 weeks before their baby’s expected birth week.

Employees can then take up to a maximum of 52 weeks off work (two of which are compulsory or four if they work in a factory). If they’re eligible (they meet the criteria mentioned above) they’ll also be entitled to receive pay for a maximum of 39 weeks.

The first six weeks of this pay should be 90% of their wages and then a minimum of £184.03 a week after that. Or, if 90% of their average earnings works out less than this minimum rate, employers should continue paying 90% for the full 39 weeks.

In adoption cases, employees will need to tell their employer that they want to take adoption leave within seven days of finding out they’ve been matched with a child. They then have the same entitlements to leave and pay as those taking maternity leave. That’s provided they meet the eligibility criteria.

For paternity leave, employees can take up to a maximum of two weeks of leave. And if the expected week of childbirth (EWC) is after 6th April 2024 or the expected date of placement (EDP) is on or after 6th April, they’ll be able to take two separate weeks of leave within a year.

They just have to give 15 weeks’ notice to say they’re entitled to take this leave. They also have to let their employer know their leave dates 28 days beforehand.

In cases of shared parental leave, eligible employees can share a maximum of 50 weeks with their spouse, long-term partner or child’s other parent. An employee should give their employer eight weeks’ notice to take this kind of leave.

Employers can also require their employees to give their notice in writing if they want them to.

April will bring lots of new changes for employees, so it’s important for employers to make sure they are up to date. If any employees are planning on taking family leave, they may have questions or concerns around their entitlements. And if employers are in any doubt ahead of April’s changes, they shouldn’t hesitate to seek advice from an HR expert.

*Kate Palmer is HR Advice and Consultancy Director at Peninsula which provides HR and health & safety support for small businesses.



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