New compensation limits

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.

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