Employment law updates - important changes for employers The Legal Partners

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The Employment Rights Act 2025 passed into law December 2025. The major changes to employment law are being implemented in phases over 2026 and 2027 with the latest phase, from April 2026 already in force. The timeline of measures, the implications for employers, and the steps you can take to prepare now are covered in our dedicated article (link) “Implementing the Employment Rights Act 2025: timelines, updates & practical tips for employers.

This article covers the the routine employment law updates that came into effect in April 2026:

1 April 2026 Increases to National Minimum Wage and National Living Wage

National Living Wage (for those 21 and over) increased to £12.71 an hour, up from £12.21.

National Minimum Wage for 18-to-20 year-olds increased to £10.85 an hour, up from £10.00.

National Minimum Wage for those under 18, and for apprentices increased to £8 an hour from £7.55

The daily accommodation offset rate is £11.10. This represents the maximum amount employers can deduct daily from an employee’s minimum wage pay for providing living accommodation.
This is the amount that employers can count towards the NMW or NLW when they provide accommodation to workers.

(The Employment Rights Act will eventually remove what the Government describes as “discriminatory age bands” so that all adults of 18 and over are entitled to the same minimum wage.)

6th April 2026 annual increases to statutory payments and tribunal awards payments 2026-2027

The statutory payments also rose in line with the usual annual inflation-linked increases in April. Our one page Factsheet provides an an overview of all the increases to the NMW, statutory and tribunal awards payments and limits.

Download: 2025 – 2026 Annual increases to statutory tribunal award payments _Employment law Factsheet

From April 6, 2026, the maximum amount of a “week’s pay” used for calculating statutory redundancy pay and other payments like the basic award for unfair dismissal, increased from £719 to £751.

The maximum compensatory award for unfair dismissal also increased from £118,223 to £123,543 (or a year’s pay, whichever is lower).

From April 6th 2025, the statutory payment for Statutory Sick Pay (SSP) paid after the first three “waiting days” of sickness, increased to £118.75 per week.

Note that under the Employment Rights Act 2025, from 6th April 2026, SSP will be paid from day 1 of sickness, with the removal of the 3 day waiting period and the lower earnings threshold to qualify.From 6th April 2026 the rate of SSP is now set at whichever is the lower of the flat rate £123.25 per week or 80% of the employee’s weekly income.

Steps to take now

If you haven’t already, update your family policies to include provision for neonatal care leave, and make sure that employees are aware of the changes.
More information on the family friendly laws that came in 2023 and 2024, and including the expansion of free childcare support in Autumn 2025, can be found in Ann Gibbon’s article on recent laws supporting new parents.

For more information or queries about issues discussed in this article, please contact Megan Bowen by email.

To speak directly with or any other of The Legal Partners team of specialist business and HR lawyers based at our Richmond UK office, or our partner lawyers in Singapore, please call +44 208 255 1914

For more information or queries about issues discussed in this article, please contact Megan Bowen by email.

To speak directly with Megan or any other of The Legal Partners team of specialist business and HR lawyers based at our Richmond UK office, or our partner lawyers in Singapore, please call +44 208 255 1914

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