UK: April 2017 changes - apprenticeship levy, tribunal compensation limits, national minimum wage, statutory benefits and immigration skills charge

From 6 April 2017 UK employers with an annual pay bill of or over £3 million will be required to pay an apprenticeship levy at a rate equivalent to 0.5% of their payroll costs, subject to an offset allowance of £15,000. Employers in England that pay the levy will be able to access funding through a digital service which is expected to open from 1 May 2017. Updated guidance is available here. The offence of wrongly advertising work as a statutory apprenticeship also came into force on 1 April 2017.

From 6 April 2017, the cap on the unfair dismissal compensatory award will increase from £78,962 to £80,541 and the cap on weekly pay (used to calculate the unfair dismissal basic award and statutory redundancy pay) will increase from £479 to £489. This gives a maximum unfair dismissal award of £95,211. Note that since 29 July 2013 there has been an additional cap on the compensatory award of 12 months’ pay.

From 3 April 2017 the weekly rate of statutory sick pay will increase to £89.35 per week (from £88.45) and the weekly flat rate of statutory maternity, paternity, adoption and shared parental pay will increase to £140.98 per week (from £139.58).

The national minimum wage rates increased from 1 April 2017. Workers of 25 years and older will be entitled to be paid a minimum national living wage of £7.50 per hour (increased from £7.20).

Subject to parliamentary approval, a new immigration skills charge will be introduced on 6 April 2017 applying to sponsors of Tier 2 workers in the General or Intra-company transfer categories (with certain limited exemptions including for those applying from inside the UK to extend an existing visa granted before 6 April 2017). The skills charge will be £1000 per year for medium or large sponsors and £364 per year for small or charitable sponsors, payable upfront for the total period of time covered by the sponsorship certificate. An annual immigration health charge for Tier 2 Intra-company transferees and their dependants is also expected to come into effect in April 2017. Other changes to immigration rules are set out in the statement here.