Increase in Employment Tribunal Caps

The Employment Rights (Increase of Limits) Order 2014 has just been released and confirms the new limits on certain awards given by Employment Tribunals.  These changes come into effect on 6 April 2014 (and so apply to dismissals which take place on or after this date).

The key changes include:-

• Limit on amount of compensatory award for “ordinary” unfair dismissal will increase to £76,574, from £74,200 (subject to the overall cap on compensation for ordinary unfair dismissal which has been in place since 29 July 2013, namely the lower of this new limit and 52 weeks’ pay) – a nice easy figure to remember!?

• Maximum amount of “a week’s pay” for the purpose of calculating a redundancy payment/basic or additional award of compensation will increase to £464, from £450.

• Minimum amount of basic award for dismissals which are unfair due to Health and Safety, employee representative, trade union, working time or occupational pension trustee reasons, will increase to £5,676, from £5,500

Due to the changes in the cap for a weeks’ pay, the maximum entitlement to statutory redundancy pay will increase to £13,920.00, an increase from the previous cap of £13,500.

These notes have been prepared for the purpose of an article only. They should not be regarded as a substitute for taking legal advice.