News added on 04.03.2020

LATEST NEWS

Pay

Annual increases to statutory compensation limits

The Employment Rights (Increase of Limits) Order 2020 has been laid before Parliament and will revise the compensation limits for certain tribunal awards and other statutory payments from 6 April 2020. What are the relevant increases?

The Employment Rights (Increase of Limits) Order 2020 will increase the maximum amount of a “week’s pay” from £525 to £538 from 6 April 2020. A “week’s pay” is used to calculate statutory redundancy payments, payments to employees in the event of insolvency and various awards including the unfair dismissal basic and additional awards.

Other key increases are the:

  • maximum compensatory award for unfair dismissal will rise from £86,444 to £88,519 (there is an additional cap of one year’s salary on the unfair dismissal compensatory award)
  • limit on the daily amount of statutory guarantee pay will increase from £29 to £30
  • minimum basic award for certain unfair dismissals, such as dismissals for reasons of trade union membership or activities, health and safety duties or acting as an employee representative or workforce representative, will go up from £6,408 to £6,562.

The increases apply where the event giving rise to the entitlement to compensation or other payment occurs on or after 6 April 2020. In unfair dismissal claims, that date is the effective date of termination of employment. The limits previously in force will still apply where the effective date of termination falls before 6 April 2020.

The increases reflect an increase of 2.4% in the retail prices index from September 2018 to September 2019.

The amount of a week’s pay used to calculate statutory redundancy payments and certain unfair dismissal awards is to rise from £525 to £538 from 6 April 2020. The maximum compensatory award for unfair dismissal will increase from £86,444 to £88,519 and the limit on the daily amount of statutory guarantee pay is to go up from £29 to £30.

© Indicator - FL Memo Ltd • Telephone: (01233) 653500 • Fax: (01233) 647100 • customer.services@indicator-flm.co.uk • www.indicator-flm.co.uk
Calgarth House, 39-41 Bank Street, Ashford, Kent TN23 1DQ • VAT GB 726 598 394 • Registered in England • Company Registration No. 3599719