Are you wondering how the UK employment law changes from April 2025 will affect you? Those most significantly affected by the upcoming changes are employers and contractors.

Some changes begin in April 2025, and others in 2026 at the earliest. So, our expert team here at Synergi have broken it down for you.

 

The background

In the Autumn Budget of October 2024, the UK government announced changes that will affect employers and employees from April 2025, including modifications to employer National Insurance Contributions (NICs), and increases to national minimum and living wage. Since their announcement, the government has published a large number of amendments and further reforms including Neonatal Care Leave and Pay, Statutory Sick Pay and more.

The Employment Rights Bill 2025 will come fully into effect by 2026 at the earliest, however there are certain employment rules that are changing in April 2025.

 

How will Contractors be affected by from April 2025?

Contractors, umbrella companies and medium to large businesses will have new rules to follow in compliance with IR35, from April 2025. Many contractors choose to work through umbrella companies to minimise the admin tasks associated in working for themselves, as they will be responsible for ensuring compliance with regulatory changes.

 

What Employment Rules are changing in April 2025?

All changes detailed below will take effect from April 2025, posing significant additional costs to employers, improved employee rights, and increases to pay for thousands of workers across the UK. All changes to UK employment laws should be reflected in your employment contracts and internal policies.

 

From 1^st April 2025 National Minimum & Living Wage rates will rise

The National Minimum and National Living wage is the minimum statutory pay for workers in the UK. National Living Wage applies as soon as the workers turn 21 years old.

Aged 21 and over (National Living Wage): Increase to £12.21 per hour (from £11.44 per hour)

Aged 18 – 20: Increase to £10.00 per hour (from £8.60 per hour)

Aged 16 – 17 and Apprentices: Increase to £7.55 per hour (from £6.40 per hour)

 

From 1^st April Statutory Sick Pay will rise

Statutory Sick Pay (SSP) will increase to £118.75 per week (from £116.35 per week). Employers will be responsible for ensuring at least 80% of employees’ average weekly earnings or the Statutory Sick Pay is paid for four or more consecutive sick days, whichever is less. Employers are then able to claim back through HMRC through existing channels.

 

From 6^th April 2025 employer-contributed NICs will rise

Employer NICs are increasing to 15% (from 13.8%), and the threshold for when employers start contributing is being reduced to £5,000 (from £9,100). There is no change for employee NIC contributions. We estimate this will cost the average business an additional £9,560 to £46,844 per annum (based on a business with 10 to 49 employees, paying their employees the median salary £37,430).

The government is also increasing the Employment Allowance from £5,000 to £10,500 and removing the £100,000 threshold, meaning many employers will not pay any NICs at all in 2025/26.

Learn more about employer NIC contributions and use the Employee National Insurance Contributions calculator to work you’re your contributions for the current tax year.

 

From 6^th April new statutory maternity, paternity, and shared parental pay

Those who qualify are entitled to receive an increased pay of up to £187.18 per week (from £184.03 per week) for maternity and other family-related leave.

 

From 6^th April Neonatal and Paternity entitlement is set to change

Employees will gain a new right to take time off when a baby under their responsibility needs neonatal hospital care, within their first 28 days of life. Parents are expected to receive a maximum of 12 weeks leave and pay, in addition to existing parental leave entitlements already in effect, from day one of employment.

 

From 6^th April Flexible Working will be a right from day one of employment

Employees will be allowed to request flexible working from their first day of employment, and employers must respond within two months, providing a reasonable explanation for refusal if they choose to reject the request.

 

From 6^th April employment tribunal compensation limits & statutory redundancy pay increases

Employee weekly pay used to calculate statutory maximum redundancy pay and the basic award for unfair dismissal, will increase to £719 per week (from £700 per week).

Learn more: https://clarkslegal.com/insights/articles/increase-to-tribunal-award-limits-effective-from-6-april-2025

 

What Employment Rules are changing in 2026 and beyond?

There are further potential changes that businesses need to be ready for, we’ve outlined the key changes below.

• Zero hours contracts will be held more accountable for providing reasonable notice of shifts, and payments for short-notice cancellations
• Removal of the two-year qualifying period of employment for the right to claim unfair dismissal
• Employers will be required to take ‘all reasonable steps’ to prevent sexual harassment of their employees (rather than previously stipulated ‘reasonable steps’)
• Requirements for businesses with over 250 employees to produce equality action plans that set out how employers will address gender pay gap issues and support employees undergoing the menopause
• Fire and Rehire malpractice will be banned except where there is no other viable commercial options for the business

 

Stay in touch with Synergi Recruitment

As one of the top engineering recruitment partners in the UK, we aim to keep each of our clients, candidates and contractors informed with changes that affect them. Get in touch with Synergi Recruitment to ensure your business is compliant with the latest employment rules.

 

Get in touch with our team: hello@synergirecruitment.com