NEW COMPENSATION LIMITS

Details of an increase in the compensation for some employment rights, effective 1st February 2012, have been published. 

The main changes are as follows:-

• The limit on the amount of a week’s pay for the purposes of calculating redundancy payments and the basic award for unfair dismissal (and some other awards) will increase from £400 to £430.
• The maximum compensation award for unfair dismissal increases from £68,400 to £72,300. 
• Guaranteed pay increases from the rate of £22.20 per day to £23.50 per day.

The new rates will apply where the issue, as a result of which payment is being made or compensation awarded, occurs on or after 1st February 2012.  This means that in the case of unfair dismissal, the new rates will apply to all dismissals where the termination date is on or after 1st February 2012, but where dismissal occurs before then, the old limits will apply, even if compensation is awarded after the implementation date. 

For further information, please contact our Employment and Immigration Group – Jane Laidler j.laidler@grm.co.uk