Skip to content

Farrer & Co | Compensation limits to be increased from April

As of 6 April 2017, there will be an increase in the compensation limits which Employment Tribunals can award and in other minimum awards payable under employment legislation.

The main changes to note are:

Type of compensation Current figure Figure from 6 April
Maximum compensatory award for unfair dismissal £78,962 £80,541
Maximum cap on week's pay (used for calculating statutory redundancy pay and unfair dismissal basic awards) £479 £489
Minimum basic award for certain unfair dismissals by virtue of, amongst other things, health and safety or trade union reasons. £5,853 £5,970
Daily rate for guarantee pay (for example, during periods of lay-off) £26 £27

The increase brings the maximum unfair dismissal award to £95,211 (compensatory award plus highest possible basic award) and the maximum possible statutory redundancy payment to £14,670.

The changes apply to dismissals, or other detriments, occurring on or after 6 April 2017. For anything falling before this date, the old limits will still apply, regardless of when compensation is actually awarded. It is worth being aware of the timing of the change if, for example, you are planning and estimating the cost of redundancy exercises in the next few months.

This site uses cookies to help us manage and improve the website and to analyse how visitors use our site. By continuing to use the website, you are agreeing to our use of cookies. For further information about cookies, including about how to change your browser settings to no longer accept cookies, please view our Cookie Policy. Click for more info