New Statutory Pay Rates, Changes To SSP and Increase In Small Employer Relief
24th March 2025
Whilst there are no changes to the rules surrounding statutory pay the annual rate of pay for statutory maternity pay, adoption, paternity pay etc. will increase from £184.03 to £187.18. At the same time statutory sick play will increase from £116.75 to £118.75 per week.
In order to qualify for statutory pay employees must earn at least the lower earnings limit. Currently the threshold is £123.00 per week. This will increase to £125.00 per week in the 2025-26 tax year.
The big change is in SSP regulations. As things stand an employee also has to earn at least £123.00 per week to qualify. To claim any SSP whatsoever, the employee has to be off for four consecutive days or more. The first three days are unpaid (waiting days). On 5th March, under the Employments Rights Bill, the government announced that they were abolishing the need to earn above the £123.00 threshold. It would also abolish the three waiting days rule. Once implemented, sick pay would become a day one right and, those employees earning below the threshold, would be entitled to 80% of their average earnings as SSP.
As the updates to SSP were not announced until 5th March, the new rules are unlikely to implemented from April. It is more likely to take effect from 1st October, or even be delayed until April 2026.
The small employer relief (SER) is the amount employers, who paid less than £45,000 in total NI contributions in the previous tax year, can reclaim from HMRC when making statutory payments to their staff. The current rate of relief is 3%, so for every £100 you pay in SMP, you can reclaim £103 from the revenue. From April 2025, the relief figure will increase to 8.5%.
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Disclaimer - All information in this post was correct at time of writing.
