New limits for unfair dismissal and redundancy payments
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Issued 30 Jan 2009
The limits on payments and awards made to workers by employment tribunals in
certain employment rights cases will rise from 1st February, under the annual
index-linked formula.
The increased limits affect:
* statutory redundancy payments;
* the basic and compensatory awards for unfair dismissal;
* the limit on guarantee payment made when employees are not provided with
work; and,
* the minimum basic award for unfair dismissal in health and safety and
certain other cases.
Table of increases in limits, effective from 1 February 2009.
(SI 2008 No. 3055)
Column 1 Column 2 Column 3 Column 4
Relevant statutory Subject of provision Old Limits New
provision Limits
Section 145E(3) of the Amount of award for £2,900 £3,100
Trade Union and Labour unlawful inducement
Relations relating to trade
(Consolidation) Act union membership or
1992 activities, or for
unlawful inducement
relating to
collective
bargaining.
Section 156(1) of the Minimum amount of £4,400 £4,700
1992 Act basic award of
compensation where
dismissal is unfair
by virtue of section
152(1) or 153 of the
1992 Act.
Section 176(6A) of the Minimum amount of £6,900 £7,300
1992 Act compensation where
individual excluded
or expelled from
union in
contravention of
section 174 of the
1992 Act and not
admitted or
re-admitted by date
of tribunal
application.
Section 31(1) of the Limit on amount of £20.40 £21.50
Employment Rights Act guarantee payment
1996 Act payable to an
employee in respect
of any day.
Section 120(1) of the Minimum amount of £4,400 £4,700
1996 Act basic award of
compensation where
dismissal is unfair
by virtue of section
100(1)(a) and (b),
101A(d), 102(1) or
103 of the 1996 Act.
Section 124(1) of the Limit on amount of £63,000 £66,200
1996 Act compensatory award
for unfair dismissal.
Paragraphs (a) and (b) Limit on amount in £330 £350
of section 186(1) of respect of any one
the 1996 Act week payable to an
employee in respect
of debt to which Part
XII of the 1996 Act
applies and which is
referable to a period
of time.
Section 227(1) of the Maximum amount of "a £330 £350
1996 Act week's pay" for the
purpose of
calculating basic or
additional award of
compensation for
unfair dismissal or
redundancy payment.
Access this information online at:
http://www.opsi.gov.u k/si/si2008/uksi_20083055_en_1
or copies are available from the Parliamentary Stationery Office.
Notes
1. Section 34 of the Employment Relations Act 1999 provides that the limits
on various awards and payments under employment legislation will be
index-linked, i.e. will be varied by Order if the Retail Prices Index (RPI) for
September of a year is higher or lower than the index of the previous September.
The variation between September 2007 and September 2008 was +5% (source: ONS,
all items RPI).
2. Section 36(1) and 36(2) of the Act abolished the previous requirement to
conduct annual reviews. A Regulatory Impact Assessment is not required in this
instance because the Act provides for indexation according to a pre-determined
formula (i.e. the RPI).
3. The new increases will apply where the event giving rise to the
entitlement to compensation occurs on or after 1 February 2009. Limits
previously in force (under the Employment Rights (Increase of Limits) Order 2007
(SI 2007/3570) are preserved by article 4 of the Order in relation to cases
where the event was before that date.
4. Legally, the Secretary of State is under a duty both to make the uprating
Order and to bring the new limits into force as soon as practicable. The changes
being made involve no changes to the structure of the awards and other payments,
or to employers' management systems.
5. Key stakeholders have been informed of the rises.
About the Author
© Crown Copyright. Material taken from the BERR- Department
for Business, Enterprise and Regulatory Reform replacing DTI - Department for
Trade and Industry. Reproduced under the terms and conditions of the Click-Use
Licence.
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Article Published/Sorted/Amended on Scopulus 2009-01-30 17:36:00 in Business Articles
