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New compensation limits

01 February 2012

The limits for awards made by employment tribunals go up from 1 February.

Key increases include:

  • limit on the amount of a week’s pay (for calculating eg statutory redundancy payments and the basic award for unfair dismissal) goes up from £400 to £430
  • maximum compensatory award for unfair dismissal goes up from £68,400 to £72,300
  • guarantee pay increases (for calculating lay-off payments) goes up from £22.20 a day to £23.50 a day
  • minimum basic award for unfair dismissal (where the dismissal is for health and safety, trade union membership/activities, employee representative or occupational pension trustee reasons) goes up from £5,000 to £5,300.

The new rates apply where the event giving rise to award/payment occurs on or after 1 February 2012.

This means that for unfair dismissal claims, the new rates will apply to all dismissals where the date of termination is either on or after 1 February 2012.

For dismissals before 1 February, the old limits will still apply, regardless of the date on which compensation is awarded.

As always, if you need commercial and pragmatic legal advice, we’re here to help so please get in touch.

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Disclaimer: All legal information is correct at the time of publication but please be aware that laws may change over time. This article contains general legal information but should not be relied upon as legal advice. Please seek professional legal advice about your specific situation - contact us; we’d be delighted to help.
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Matthew Clayton MA LLM (Cantab), CIPP/E
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