April 2026 changes to NMW, statutory payments & employment tribunal awards

Key employment rates and limits are changing from April 2026, including increases to statutory payments, national minimum wage rates and unfair dismissal compensation. 

Employers should now be reviewing policies, payroll systems and budgets to ensure compliance with the new changes.

Here, Isobel Netherwood and Joseph Shelston discuss some of the key changes that both employers and employees should be aware of.

Statutory rates

The Social Security Benefits Up-rating Order 2026 brings increases to various statutory payments from early April 2026. These changes will affect payroll planning, family-related leave entitlements and employer budgeting.

Sick pay

• On 6 April, statutory sick pay (SSP) rises from £118.75 to £123.25 or 80% of the employee’s average weekly earnings (whichever is lower).
• On the same day, under changes being brought in by the Employment Rights Act, SSP will now be payable from day one of sickness (rather than day four). This is a significant cost change for employers.

Family-related leave payments

• Statutory maternity pay: from 5 April 2026, the prescribed rate (the rate normally paid after the initial six weeks at 90% of the employee’s average weekly earnings) increases from £187.18 to £194.32.
• Maternity allowance: from 6 April 2026, this will increase from £187.18 to £194.32.
• Statutory paternity pay, adoption pay, shared parental pay, parental bereavement pay & neonatal care pay: on 6 April 2026, these will also increase from £187.18 to £194.32 or 90% of the employee’s average weekly earnings (whichever is lower). Note that for statutory adoption pay — as for statutory maternity pay — the employee is entitled to 90% of their average weekly earnings for the first six weeks of adoption leave. 

National Minimum Wage & National Living Wage

From 1 April 2026, the following National Minimum Wage (NMW) and National Living Wage (NLW) rates will apply:

• NLW (21 years old and over): £12.71 (50p increase from 2025 rates).
• 18 to 20 years old: £10.85 (85p increase).
• 16 to 17 years old: £8 (45p increase).
• Apprentice: £8 (45p increase).
• Accommodation offset: £11.10 (44p increase).

These increases will add cost pressures and employers should assess their impact on rota planning, pay structures, contracted hours and internal pay differentials.

Employment Tribunal awards increasing

As usual, compensation limits and award levels in employment tribunal cases are increasing with effect from April 2026. 

Unfair dismissal

The Employment Rights (Increase of Limits) Order 2026 introduces updated compensation limits and minimum awards payable for dismissals taking effect on or after 6 April 2026.

Week’s pay

The statutory limit on a week’s pay (used, among other things, to calculate statutory redundancy payments and basic awards for unfair dismissal) increases from £719 to £751. This means that the maximum basic award for unfair dismissal and the highest statutory redundancy payment will be £22,530.

Compensatory award

The statutory cap for the unfair dismissal compensatory award increases from £118,223 to £123,543 or 52 weeks’ pay (whichever is lower). This is expected to be the last increase due to the statutory cap being removed entirely from January 2027 under the Employment Rights Act’s unfair dismissal changes.

Minimum basic award

For certain unfair dismissals, the minimum basic award rises from £8,763 to £9,157. This includes situations where the reason or principal reason for dismissal is related to trade union membership or activities, carrying out activities as a health and safety representative, carrying out duties as an occupational pension scheme trustee or carrying out functions as an employee or workforce representative.

Employers managing disciplinaries, redundancies and organisational changes should factor these increased liabilities into risk assessments and settlement strategies.

Collective Redundancy Consultation 

Protective award doubling

From 6 April 2026, the Employment Rights Act is doubling the protective award where an employer fails to comply with their duty to collectively consult when they’re proposing to dismiss as redundant 20 or more employees at one establishment within a 90-day period. 

Currently, a protective award is capped at 90 days’ gross pay. The change will see maximum awards being capped at 180 days’ gross pay.

It’s critical that employers fully comply with their collective consultation duties to avoid costly protective awards.

Injury to feelings awards

The Vento bands set the levels of compensation that an employment tribunal may award for injury to feelings in discrimination and whistleblowing detriment cases. 

The annual update to the Vento bands has recently been published. For claims brought on or after 6 April 2026, the guidelines are as follows:

• Lower band of £1,300 to £12,600 for “less serious cases”.
• Middle band of £12,600 to £37,700 for “cases which do not merit an award in the upper band”.
• Upper band of £37,700 to £62,900 for “the most serious cases”.
• In “the most exceptional cases”, awards may exceed £62,900.

To minimise the likelihood of injury to feelings awards and discrimination and whistleblowing complaints generally, employers should be proactive in preventing workplace issues by setting expectations about workplace behaviour through policies and training. Where issues do arise, complaints should be carefully resolved if possible.

Talk to us

Our award-winning employment team is here to help you navigate the Employment Rights Act and prepare for its many legislative changes. 

We offer expert advice on everything from reviewing policies and updating contracts to assessing risk exposure and ensuring the compliance of payroll and HR systems.

Talk to our team by calling 0333 004 4488, emailing hello@brabners.com or completing our contact form.