Compensation Limits

Posted on Jan 20 in Latest News by

The annual Employment Rights (Increase of Limits) Order 2011 has been published. The changes set out below will apply where the effective date of termination of employment falls on or after 1 February 2012:

  • The maximum compensatory award for unfair dismissal increases from £68,400 to £72,300.
  • The statutory cap for a week’s pay, most often used for calculating a basic award for unfair dismissal and a statutory redundancy payment, increases from £400 to £430.
  • The maximum basic award and statutory redundancy payment therefore rise from £12,000 to £12,900.
  • The minimum basic award for unfair dismissal (which applies to dismissals by reason of trade union membership or activities, health and safety duties, occupational pension scheme trustee duties or acting as an employee representative) increases from £5,000 to £5,300.

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