UK: April 2026 Statutory and Compensation Rate Increases

Authors: Robert Hill, Corinna Harris, Sophie Jackson, & Charlotte Stern

The usual UK annual increases to statutory payment rates and compensation limits take effect from early April 2026.

The key increases to rates and limits are outlined here:

• Unfair dismissal and redundancy limits:
  • New limits apply where the effective date of termination is on or after 6 April 2026: The limit on a week’s pay for the purposes of calculating statutory redundancy payments and compensation for unfair dismissal increases to £751 (up from £719). The maximum statutory redundancy payment and the basic award for unfair dismissal is now £22,530
  • The maximum compensatory award for unfair dismissal increases to £123,543 (from £118,223), or 52 weeks’ gross pay if less. This compensatory cap will apply until 31 December 2026, after which the cap will be removed entirely
• Other statutory rate increases include:
  • Statutory Sick Pay: £123.25 per week (up from £118.75) from 6 April 2026
  • Family leave-related statutory payments: Statutory Maternity Pay and Statutory Adoption Pay (after the first 6 weeks), Statutory Paternity Pay, Statutory Shared Parental Pay, Statutory Neonatal Care Leave Pay and Statutory Parental Bereavement Pay all increase to £194.32 per week (up from £187.18), or 90% of the employee’s average earnings if less. The SMP rate applies from 5 April 2026, with all other rates applying from 6 April 2026
  • National Living Wage: the hourly rate for workers aged 21 and over is£12.71 (up from £12.21) from 1 April 2026

Key Action Points for Human Resources and In-house Counsel

In addition, Tribunal awards for injury to feelings in discrimination claims will increase for claims issued on or after 6 April 2026:

• Lower band (less serious cases): £1,300 to £12,600
• Middle band (cases that don’t merit an award in the upper band): £12,600 to £37,700
• Upper band (most serious cases): £37,700 to £62,900, with the most exceptional cases capable of exceeding this level