employment law changes 2021

With all the noise around Brexit and the ongoing COVID-19 pandemic, many people have struggled to keep up to date with changes in legislation and Employment Law. In April 2021, several changes in Employment Law came into force that are worth being aware of as an organisation or an employee.

In this blog post we will cover those changes.

Compensation Awards and Rates – Employment Tribunal

As of the 6th April 2021, the maximum week’s pay for redundancy purposes will increase to £544, from the previous figure of £538. For the purposes of tribunal claims this is important as it means that the statutory redundancy pay, and the unfair dismissal award pay, will both now be £16,320.

The unfair dismissal compensatory award (which compensates the claimant for past and future loss attributed to the dismissal), is a maximum of 52 weeks’ pay which is subject to a new maximum of £89,493.

The maximum for additional award, which is set to compensate claimants where the employer fails to follow the tribunal’s instruction to re-employ the claimant, taking into account average weekly earnings, will rise to £28,288.

Statutory guarantee pay

This is where an employee is entitled to guarantee pay during lay off or short-time working, and will remain at remain at £30. The maximum they can receive is £30 a day for 5 days in any 3-month period, making a maximum of £150. If they usually earn less than £30 a day they will get their normal daily rate. If the employee works part-time, their entitlement is worked out proportionally.

Statutory Sick Pay

As of the 6th April 2021, Statutory Sick Pay (SSP) will rise to £96.35 per week, up from the previous figure of £95.85. The lower earnings limit in relation to entitlement to statutory payments of £120 per week will remain the same.

SSP is currently paid for up to 28 weeks and must be paid by employers to all eligible employees who are too ill to work.

Please note – Self-isolating – COVID-19.

An employee could receive SSP if they are self-isolating because:

  • They or someone they live with has coronavirus symptoms or has tested positive for coronavirus
  • They have been notified by the NHS or public health authorities that they have been in contact with someone with coronavirus
  • Someone in their support bubble (or their extended household if they live in Scotland or Wales) has coronavirus symptoms or has tested positive for coronavirus
  • They have been advised by a Doctor or Health professional to self-isolate before going into hospital for surgery


Currently, they can also receive SSP if they’ve been advised to shield in Scotland or Northern Ireland because they are at very high risk of severe illness from coronavirus.  Shielding has paused in England and Wales.

They cannot receive SSP if they’re self-isolating after entering or returning to the UK and do not need to self-isolate for any other reason.

Other than the above, SSP is available to an employee from the 4th day of sickness

Family Leave

As of 4th April 2021 the weekly rates for statutory family leave (maternity, paternity, adoption, shared parental and parental bereavement leave) will increase to £151.97 (or 90% of the employee’s average weekly earnings, whichever is lowest).

National Living Wage Rates

From 6th April 2021, the National Living Wage increases in line with the annual cost of living rises meaning that the new Living Wage will be £8.91.

Additionally, there has been a change to the age banding which now makes the National Living Wage applicable to those aged 23 years and over as opposed to the previous band which was only applicable to those aged 25 and over.

Gender Pay Gap Reporting

Employers with 250+ employees are legally required to report on the difference in the earnings between men and women. Most public authority employers were due to report by 31st March 2021 and private, voluntary and all other public authority employers by 4th April 2021.

Due to the ongoing coronavirus pandemic the above deadlines have been extended for all employers to 5th October 2021.