Have you budgeted for increased payroll costs from April 2019?
Have you budgeted for increased payroll costs from April 2019? From April, the National Living Wage and the National Minimum Wage rates will increase alongside a 2.4% rise in statutory payments such as statutory maternity, paternity, adoption, shared parental pay and statutory sick pay.
Who gets the minimum wage?
According to the HMRC, to be entitled to the National Minimum Wage workers must be at least school leaving age (last Friday in June of the school year they turn 16). They must be 25 or over to get the National Living Wage.
Workers are also entitled to the correct minimum wage if they’re:
- casual labourers, for example, someone hired for one day
- agency workers
- workers and homeworkers paid by the number of items they make
- trainees, workers on probation
- disabled workers
- agricultural workers
- foreign workers
- offshore workers
Apprentices are entitled to receive the apprentice rate if they’re either:
- aged under 19
- aged 19 or over and in the first year of their apprenticeship
This rate will increase from £3.70 to £3.90 an hour from April.
Apprentices are paid the minimum wage for their age if they both:
- are aged 19 or over
- have completed the first year of their apprenticeship
You can find a list of all what their hourly rate should be on the gov.uk website.
From April 2019, statutory maternity, paternity, adoption and shared parental pay will increase from £145.18 to £148.68 per week.
In addition, statutory sick pay will increase from £92.05 to £94.25 per week.
You can find calculators for each of these statutory payments on the gov.uk website:
- Maternity, Adoption and paternity calculator for employers
- Calculate your employee’s statutory sick pay
Updating your budget
It is essential to update your financial forecasts to include these wage and statutory payment increases to analyse what impact they may have on your business. Doing this now will give you time to make any necessary changes to your processes or sales forecasts to facilitate these additional expenses.
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