PAYROLL CHANGES FROM 6 APRIL 2026: WHAT UK EMPLOYERS NEED TO KNOW
Updated: Oct 6
The April 2026 payroll changes are now live. If you run payroll for a small business, the biggest shift is to Statutory Sick Pay (SSP). Some of it also affects family leave, minimum wage and who is responsible for PAYE when you use an umbrella company.
Sadler Advisory helps UK small businesses keep payroll simple and compliant. So here is a plain guide to what changed, what it costs, and what to check now.
Snapshot of the April 2026 Payroll Changes | |
Change: | Effect: |
SSP from day one | The three waiting days are now gone. SSP is payable from the first day of sickness. |
Lower Earnings Limit removed | The old £125 a week earnings threshold no longer applies. Every employee can qualify. |
New SSP rate | The lower of £123.25 a week or 80% of average weekly earnings. |
Day one family leave | Paternity leave and unpaid parental leave no longer need a minimum length of service. |
Higher statutory rates | Parental pay rises to £194.32 a week. National Living Wage rises to £12.71 an hour. |
Fair Work Agency | A new enforcement body that can pursue unpaid SSP, holiday pay and minimum wage. |
SICK PAY FROM DAY ONE
Before April, SSP only started on the fourth day of sickness. So a one or two day absence cost you nothing in statutory pay.
That has changed. If an employee is off sick for a single day, SSP is now due for that day.
What this means in practice:
Short, one-off absences now carry a statutory cost.
You need accurate absence records for every sick day, not just longer spells.
Your payroll software must be set up for day one SSP. Check this, don't assume it.
NO MORE LOWER EARNINGS LIMIT
Under the old rules, employees earning less than £125 a week did not qualify for SSP. That cut out many part-time and lower-paid staff.
The limit has been removed. If someone is an employee, they can qualify for SSP, whatever they earn.
This matters most if you employ:
Part-time staff on low hours
Casual or seasonal workers on employment contracts
Anyone who works for you alongside another job
THE NEW SSP RATE
SSP is now the lower of:
The standard weekly rate of £123.25 (up from £118.75), or
80% of the employee's average weekly earnings
Two quick examples:
An employee earning £200 a week would get 80% (£160), but the flat rate is lower. They receive £123.25.
An employee earning £135 a week would get 80% (£108), which is lower than the flat rate. They receive £108.
The 80% test is new, so it will catch people who previously got nothing. Your payroll provider needs to work out average weekly earnings correctly, including where one sickness absence links back to an earlier one.
If an employee was already off sick on 5 April, check how they were treated. Some people who got no SSP before the change became entitled from 6 April, and there is transitional protection for others.
THE 7-DAY SELF-CERTIFICATION RULE
This part of the rules did not change in April, but it matters more now.
For the first seven calendar days of sickness, an employee can self-certify. You should not insist on a doctor's note.
From day eight, you can ask for a fit note.
Note: The seven days do include weekends and non-working days.
If an employee is late sending a fit note, you cannot withhold SSP for that reason alone.
With SSP starting on day one, you will be handling more short absences. A simple self-certification form and a clear written process save time and avoid disputes. If you pay company sick pay on top of SSP, check your policy wording still makes sense alongside the new rules.
FAMILY LEAVE CHANGES
Two further changes took effect on 6 April 2026:
Paternity leave and unpaid parental leave are now day one rights. The length of service requirement has gone.
Statutory parental pay (maternity, paternity, adoption, shared parental, neonatal care and parental bereavement) rose to £194.32 a week, or 90% of average weekly earnings if that is lower.
If you have a new starter who is expecting a child, they may now be able to take leave much sooner than before. Update your family leave policy and tell your payroll provider early.
OTHER RATES TO UPDATE
Not every April change is a new law, but these figures also changed and need to be right in your payroll:
National Living Wage (21 and over): £12.71 an hour from 1 April
18 to 20 rate: £10.85 an hour
16 to 17 and apprentice rate: £8.00 an hour
Weekly pay cap for redundancy calculations: £751
Maximum statutory redundancy payment: £22,530
The minimum wage increases apply from the first pay period starting on or after 1 April. If you were slow to update, check back pay.
UMBRELLA COMPANIES AND THE FAIR WORK AGENCY
Two changes that sit alongside the rate rises:
Umbrella companies: From 6 April 2026, the rules on who is responsible for PAYE and Class 1 National Insurance changed where an umbrella company is involved. If you engage contractors through umbrellas, check where the liability now sits.
Fair Work Agency: This new body started in April 2026. It can enforce SSP, holiday pay and minimum wage. Getting your payroll right now is cheaper than putting it right after a complaint.
YOUR APRIL 2026 PAYROLL CHECKLIST
Run through these steps:
Confirm your payroll software is calculating day one SSP and the 80% rule.
Check no one has been wrongly excluded from SSP because of their earnings.
Update your sickness absence and family leave policies.
Make sure you have a simple self-certification process in place.
Check minimum wage rates for every age band.
Review any umbrella company arrangements.
Keep clear records of every absence, however short.
YOUR PARTNER FOR PAYROLL
Payroll rules change every April, and this year's changes go further than most. We can run your payroll, check your set-up is correct, or help you update your policies so you stay compliant without the headache.
If you have questions about any of these changes, please contact us at Sadler Advisory. You can also read more on our Payroll Services page.
And be sure to check out our blog for more practical insights on payroll, tax and accounting for small businesses.
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