Your April 2025 HR Compliance Checklist:
April 2025 marks a significant milestone for UK businesses as several major employment law changes are set to come into effect simultaneously. These updates will impact everything from wages to statutory leave, making proactive preparation necessary for HR professionals and business owners alike.
Businesses that fail to prepare risk not only compliance issues but also unplanned financial pressure at a time when many are already facing economic challenges.
Our comprehensive checklist is designed to help HR managers navigate these upcoming changes, ensuring your business is fully compliant by the implementation deadlines. By breaking down each area of change and providing actionable steps, we aim to simplify what could otherwise be an overwhelming process.
Why Are April 2025’s Changes So Anticipated?
Unlike previous years where adjustments were often modest, the April 2025 changes include increases to minimum wage rates (with some age brackets seeing rises of over 16%) and significant adjustments to employer National Insurance contributions. Together, these changes will have a measurable impact on employment expenses and potential liabilities.
Small and medium-sized enterprises (SMEs) with tight operating margins may feel these changes most acutely, especially those in sectors with high numbers of minimum wage staff such as hospitality, retail, and care services. However, businesses of all sizes need to prepare for the financial implications of these updates.
National Minimum Wage Increases
From April 1st, 2025, the National Minimum Wage will increase significantly across all age brackets. These increases reflect adjustments for inflation and cost of living, with particular attention to expected economic trends through March 2026.
The new rates represent substantial percentage increases:
- 21+ years: £12.21 (up from £11.44) – a 6.7% increase
- 18-20 years: £10.00 (up from £8.60) – a 16.3% increase
- Under 18 and apprentices: £7.55 (up from £6.40) – an 18% increase
These increases will significantly impact payroll costs for businesses employing minimum-wage workers.
Compliance Checklist for National Minimum Wage:
Calculate the financial impact of the increases on your overall payroll costs.
Update payroll systems to reflect the new rates from April 1st, 2025.
Revise budgets and financial forecasts to account for increased wage costs.
Review pricing strategies and operations to absorb increased costs where possible.
Ensure all pay elements are properly categorised to avoid minimum wage violations.
Communicate changes to managers and supervisors responsible for payroll approval.
Consider the impact on pay differentials and whether adjustments may be needed for staff currently paid above minimum wage.
National Insurance Contribution Changes
April 6th, 2025, brings significant changes to employer National Insurance Contributions (NICs), creating a double impact on employment costs. These changes include:
- An increase in the Secondary Class 1 NIC rate from 13.8% to 15%
- A reduction in the secondary threshold (the point at which employers start paying NICs) from £9,100 to £5,000 per year
This means businesses will pay a higher percentage of NICs on a wider range of employee earnings.
Compliance Checklist for NIC Changes:
Ensure payroll systems are updated to apply the new 15% rate.
Adjust the secondary threshold to £5,000 in your systems.
Calculate the total financial impact across your workforce.
Review employee benefits packages in light of increased employment costs.
Ensure your payroll team or provider is fully briefed on the changes.
Update financial forecasts to reflect the increased costs.
Consider whether pricing strategies or operational efficiencies need adjustment.
Statutory Pay Rate Changes
There will be updates to various statutory pay rates that employers need to implement. These include:
Statutory Sick Pay (SSP):
Weekly rate increasing from £116.75 to £118.75 (a 1.7% increase)
Statutory Family Pay:
The weekly rate for statutory maternity, paternity, adoption, shared parental, and parental bereavement pay will increase to £187.18 (from £184.03).
New Neonatal Care Leave and Pay:
- From April 6th, 2025, eligible parents can access up to 12 weeks of extra leave for babies requiring neonatal care.
- This will be a day-one right for leave, with pay (at £187.18 weekly) available to those with 26 weeks’ service.
Compliance Checklist for Statutory Pay Changes:
Update payroll and HR systems with all new statutory rates.
Create or update policies for neonatal care leave
Review absence management systems to incorporate the new rates and entitlements.
Brief line managers on the new neonatal care leave entitlements and processes.
Update employee handbooks and resources.
Create communications for employees about the new and updated entitlements.
Review budgets to account for potential additional costs.
Ensure your payroll team or provider is fully briefed on all rate changes.
Policy and Documentation Updates
These changes will mean various policies, handbooks, and contractual documentation will need to be updated to reflect the new regulations. Being proactive with these updates will ensure smooth implementation and clear communication with employees.
Essential policy updates include:
- Employee handbooks
- Employment contracts
- Company resources
- Training and development resources
- New starter information
Compliance Checklist for Policy and Documentation:
Audit all affected policies and identify required changes.
Prioritise updates based on implementation deadlines.
Plan a communication strategy for informing employees of relevant changes.
Update all electronic and physical versions of documentation.
Ensure managers and HR team members are briefed on policy changes.
Review employment contracts to identify any areas requiring updates.
Establish a verification process to ensure all documents have been updated correctly.
Conclusion
The April 2025 employment law changes represent a significant compliance challenge for UK businesses. With substantial increases to the National Minimum Wage, major changes to employer National Insurance contributions and new statutory pay rates, including the introduction of Neonatal Care Leave, businesses need to be sure that they are prepared.
By following the checklists provided in this guide, HR professionals and business owners can approach these changes methodically, reducing the risk of non-compliance and disruption.
Remember that compliance is not just about avoiding penalties, it’s about creating a fair and positive work environment for your employees while protecting your business from unnecessary risk and expense.
How Petaurum HR Can Support You
Facing these employment law changes doesn’t have to be overwhelming. Petaurum HR offers specialised support to ensure your business is prepared no matter what changes come your way. Contact our team to discuss how we can support you and your business.