Increased Statutory Sick Pay and Maternity 2020

Government proposes an increase to both maternity and sick pay

Increased rates for family friendly leave and long-term sickness this April.

Following up from last month’s announcement regarding the minimum wage increase, the government have proposed an increase to the existing statutory rates. The Legislation will entitle employees whom qualify to a statutory payments whilst taking a period of sick leave, or ‘family friendly leave’ which includes maternity, paternity and adoption leave. The rates set will be reviewed each year and the increases will be implemented in April 2020.

Statutory maternity rates of pay are set to increase on the 5th of April.

Employees will be entitled to the weekly increased rate of £151.20, up from £148.68, the qualifying criteria will not change. What this means is that anyone whose average weekly earnings are below than this statutory rate will be entitled to receive 90% of their average weekly earnings. Pay rates for employees taking maternity or adoption leave will also be entitled to the same increase again rising to £151.20 weekly.

On the 6th April 2020, a day later statutory sick pay is set to increase, keeping in line with the first Monday of the new tax year. Employees, from this date forward, will then be entitled to £95.85 weekly. Employees will only be able to receive this increase if their earnings are above or equal to the lower earnings cap. At present this stands at £118 per week and it is expected that a new lower earnings limit is set to be announced.

Before April, companies and organisations should review the policies they have in place for statutory leave and make sure that they are all up to date. For organisations that already offer statutory minimum pay for periods of leave should by now already be familiar with how the process works and its very important that the payroll departments understands that they will need to abide by the increased rates. Failure to pay the correct amount could end in a tribunal and can be very costly.

It’s also important to understand how the new rates will impact any employee’s that are already in a period of statutory leave. When the new rates are introduced, existing payments will need to be reviewed and increased where necessary, this will ensure staff are remunerated accordingly.

Write a Comment