It’s that time of year again where we look at what changes are coming to employment law in April 2025. Whilst we are still all getting our head round the 20 plus reforms the Employment Rights Bill proposed as part of the new government – these are not actually on the radar until 2026, so we have time to prepare.
Coming this year is Neonatal Leave and Pay The Neonatal Care (Leave and Pay) Act 2023; which received Royal Assent on 24 May 2023 and will allow eligible employed parents whose newborn baby is admitted to neonatal care to take up to 12 weeks of paid leave. This is in addition to other leave and pay entitlements such as maternity and paternity pay. For employers this will mean ensuring this leave entitlement is added to their HR policies and that managers are briefed on the changes in readiness for any employee requests.
Changes in Employment Law – Pay
In addition, we have the usual updates to statutory payments:
Maternity, Paternity, Adoption, Shared Parental, and Parental Bereavement pay will increase to £187.18 per week,
while Statutory Sick Pay will rise to £118.75 per week
National Minmum Wage also increases:
| 21+ | 18 to 20 | Under 18 | Apprentice | |
| April 2024 (current rate) | £11.44 | £8.60 | £6.40 | £6.40 |
| April 2025 | £12.21 | £10.00 | £7.55 | £7.55 |
But probably one of the most talked about increase in the rise in Employers National Insurance Contribution rates (NIC); which will impact staff costs, cash flow and margins for many SMEs.
The rate of employers’ NICs will increase from 13.8% to 15%, from April 2025. The level at which employers start paying NICs (the secondary threshold) will also reduce from £9,100 to £5,000 per year.
To help small businesses offset the increased NIC costs, the Employment Allowance which helps eligible employers reduce their NIC liability, will increase from £5,000 to £10,500, and the £100,000 eligibility threshold will be removed.
Not all companies will be affected. A few will actually benefit from the increased Employment Allowance. But many others face significantly higher costs from the rising contribution rate and lower threshold.
With payroll being one of SME’s biggest expenditures, businesses are having to think outside the box for ways to get their products made, services delivered and internal processes carried out. The use technology, outsourcing and making cut backs elsewhere are all ways the businesses are using to compensate for the increased NI costs.
Slice can help you review your workforce, manage any reductions in headcount you need to make but also work with you on any outsourcing possibilities.
There is a lot more on the horizon for Employment Law in 2026 and this year feels very much like a watch this space time, but there are ways in which to get prepared for any imminent changes and Slice are here to help you with that.
Remember – don’t cut corners – take a Slice!