New limits on compensation that can be awarded at the Employment Tribunal have been announced.

The new limits, which apply to dismissals occurring on or after the 1st February 2006, are as follows:
  • The maximum of a “weeks pay”, for the purpose of calculating statutory redundancy payments, the basic award for unfair dismissals, rises from £280.00 to £290.00.
  • The maximum compensatory award for unfair dismissal cases rise from £56,800 to £58,400.
  • The minimum basic award that applies, where the reason for dismissal is trade union membership or activities; carrying out duties as a health and safety representative or a trustee of an occupational pension scheme, or performing functions or activities as an employee representative rises from £3,800 to £4,000.
The increase in compensation limits makes it all the more important for employers to ensure that they follow the correct procedures when seeking to dismiss an employee. This is particularly so, given that under the new statutory dismissal and disciplinary procedures, Employment Tribunals are entitled to uplift any compensation awarded by between 10% and 50% to reflect a failure by an employer to dismiss using the correct process.

If you would like further advice on dismissing fairly, telephone Suzanne Brookes on 01271 324 273 or contact her by email at for further advice. A single telephone call is often all that is required to ensure that the risks associated with dismissal are avoided.
The contents of this article are intended for general information purposes only and shall not be deemed to be, or constitute legal advice. We cannot accept responsibility for any loss as a result of acts or omissions taken in respect of this article.