Legislation has been laid before parliament, setting out new compensation limits for certain employment tribunal claims.
The Employment Rights (Increase of Limits) Order 2022 increases the maximum amount of a week’s pay for the purpose of calculating a statutory redundancy payment (or the basic award for unfair dismissal) from £544 to £571, making the maximum statutory redundancy payment £17,130. The maximum compensation awarded for unfair dismissal will increase from £89,493 to £93,878. There will also be increases to other tribunal awards, including the minimum basic award for certain automatically unfair dismissals, such as where the reason for the dismissal is determined to be the worker’s membership of a trade union.
The new limits are intended to come into force on 6 April 2022, and will only apply where the relevant act giving rise to the claim (e.g. the effective date of termination in relation to a claim of unfair dismissal) occurs on or after this date. The increases are in line with the increase in the Retail Prices Index measured in September 2021.