The current financial year is coming to a close so now is the time to prepare your payroll for the new financial year and make sure you are ready for changes that affect your employees.
From 1 April 2020, the National Minimum Wage will increase.
The main rate increases from £8.21 to £8.72
- 25 and over increase from £8.21 to £8.72
- 21 to 24 increases from £7.70 to £8.20
- 18 to 20 increases from £6.15 to £6.45
- Under 18 increases from £4.35 to £4.55
- Apprentice increases from £3.90 to £4.15
You’ll find more information about who gets the minimum wage at gov.uk/national-minimum-wage.
It is time to review your employees date of birth and ensure that with effect from your first pay period after the 1st April 2020 you increase their hourly rate to either the National Minimum Wage, or if 25 plus, the National Living Wage.
What do I need to look out for with Apprentices?
There are some differences around Apprentices. The Apprentice wage is due to increase to £4.15 per hour if the Apprentice is either under 19 or in their first year of Apprenticeship aged 19 or above. If your employee has completed their first year of an Apprenticeship and is 19 or older they must be put on with the correct National Minimum Wage or National Living Wage for their age group.
If during the course of the next financial year any of your employees reach a milestone birthday, i.e. 18, 19, 21, or 25 then you must increase their hourly rate from the first pay period after their birthday.
Check National Insurance categories
National Insurance category may also change if you have any employees turning 21 or 65 in the next 12 months. It is your responsibility to update your employees Wages & NI category letter for the pay period following their birthday.
Workplace Pensions stay the same, but you may need to re-declare compliance
Unlike last year, this time there are no changes to minimum workplace pension contributions. However you may receive a notification from The Pensions Regulator to re declare your compliance regarding Workplace Pensions.
Every 3 years any employee who opted out of the Workplace Pension is given the opportunity to opt back in. You then need to re declare your compliance even if there are no changes to any employees wishing to opt back in.
For further information and any help completing payroll or pensions tasks, please do not hesitate to contact the team at Wessex. We are here to help.