April 2025: What’s Changing for EMPLOYERS?

23 Mar

With the Employment Rights Bill still making its way through Parliament, HR professionals must prepare for several key employment law changes coming into effect this April.

Alongside the annual updates to minimum wage rates and statutory allowances, businesses must also navigate new obligations around neonatal leave, redundancy, and a significant rise in employers’ National Insurance contributions (NICs).

Here’s what Employers need to know for April 2025:

National Minimum Wage Increases

From 1 April 2025, the National Living Wage will rise to £12.21 per hour for employees aged 21 and over. Other rates will also increase:

Ages 18-20: Up by £1.40 to £10.00 per hour
Ages 16-17: Up to £7.55 per hour
Apprentices: Minimum wage rises to £7.55 per hour

These changes impact payroll, budgeting, and recruitment strategies, so employers should review their pay structures accordingly.

Employers’ National Insurance Contributions (NICs) Increase

From 6 April 2025, employers will face higher NIC costs:

NIC rate rises from 13.8% to 15%
Threshold for employer NICs liability drops from £9,100 to £5,000 (until April 2028)
Employment Allowance increases from £5,000 to £10,500
£100,000 eligibility threshold for the allowance is removed

HR teams must assess how these changes impact payroll budgets and employer contributions.

Statutory Sick Pay (SSP) Rises

From 6 April 2025, SSP will increase by £2 to £118.75 per week. The lower earnings threshold required to qualify will also rise to £125 per week.

Neonatal Care Leave and Pay Introduced

From 6 April 2025, eligible families with babies in neonatal care will benefit from:

Up to 12 weeks’ neonatal care leave
Statutory neonatal care pay for those meeting minimum earnings and service requirements
Weekly neonatal care pay set at £187.18 (aligned with other family leave payments)

HR teams must update policies to reflect this new statutory leave entitlement.

Statutory Redundancy and Tribunal Award Limits Increase

From 6 April 2025, key limits will rise:

Statutory redundancy pay cap: Weekly pay limit increases from £700 to £719
Unfair dismissal compensatory award cap: Rises from £115,115 to £118,223
Unlawful inducement (trade union activities) compensation: Maximum award increases from £5,000 to £5,735

These changes may impact redundancy processes and tribunal claims, making compliance essential.

Maternity, Paternity, and Adoption Pay Rates Increase

From 6 April 2025, statutory family leave payments will rise:

Maternity, paternity, adoption, and shared parental leave pay: Increases from £184.03 to £187.18 per week
Earnings threshold for eligibility: Rises from £123 to £125 per week
Carer’s allowance threshold: Weekly earnings cap increases from £151 to £196, with payments rising from £81.90 to £83.30 per week

Employers should ensure payroll systems are updated to reflect these changes.

Preparing for April 2025: Next Steps for HR

HR professionals must stay ahead of these employment law updates by:

✔ Reviewing payroll systems to accommodate new minimum wage rates and statutory pay changes.
✔ Assessing the financial impact of NIC increases on employer costs.
✔ Updating policies to reflect new rights such as neonatal leave and redundancy pay changes.
✔ Communicating changes to employees and providing guidance where needed.

With these changes fast approaching, now is the time to ensure full compliance and avoid potential HR headaches.