Employment rates and limits

Stay updated with the rising employment rates and limits.

As April 2023 approaches, schools should ensure they are ready for the annual increases to the employment rates and limits which are set to take effect.

From 1st April 2023, National Living Wage and National Minimum Wages rates will rise as follows:

  • National Living Wage: £10.42
  • 21-22 year old rate: £10.18
  • 18-20 year old rate: £7.49
  • 16-17 year old rate: £5.28
  • Apprentice rate: £5.28
  • Accommodation offset: £9.10

From 2nd April 2023, Statutory Maternity Pay, Statutory Paternity Pay, Statutory Shared Parental Pay and Statutory Adoption Pay will increase to a weekly rate of £172.48.

From 6th April 2023 Statutory Sick Pay will increase to a weekly rate of £109.40.

There will be no changes to an employee’s personal allowance. 

The thresholds for the basic rate and higher rate income tax brackets will be frozen, however the additional rate income tax bracket of 45% will apply to earnings over £125,140 as opposed to over £150,000 as it was in 2022/23.

As usual, there will be an increase in the limits that apply to compensation payments where employment is terminated. These new limits will apply to dismissals that take effect from 6th April 2023.

  • The cap on a week’s pay for the purposes of calculating a statutory redundancy payment or an unfair dismissal basic award will rise to £643.
  • The cap on an unfair dismissal compensatory award will rise to £105,707.

If schools are contemplating dismissing a member of staff, where possible it would be sensible to ensure the dismissal takes effect prior to 6th April so that it is not caught by the new limits.

How Moore Barlow can help

If you would like further advice and our support with this, our Independent Schools Team would be happy to guide you through the process.