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Tamasin Dorosti
Tamasin Dorosti,
Trainee Solicitor
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Compensation limits
14 March 2017

This week we report on BIS’ new unfair dismissal compensation increase and recap on other statutory rates of pay.

Compensation Limits

The Government through BIS have set new limits of compensation under the Employment Rights (Increase of Limits) Order 2017. What are the main changes?

New limits for maximum compensation limits for unfair dismissal claims for England, Scotland and Wales come into effect on 6 April 2017. Northern Ireland will set its own limits at a later date.

The two main changes which will impact employers are as follows:

  1. The limit on the unfair dismissal compensatory award has risen from £78,962 to £80,541.

  2. The maximum amount of a week’s pay for the purpose of calculating a redundancy payment or the basic/additional award of compensation for unfair dismissal has risen from £479 to £489.

These changes will apply to dismissals occurring on or after 6 April 2017.

Other Changes

Other rate changes coming into force in April 2017 are increases to i) family friendly statutory leave rates and ii) statutory sick pay.

Family Friendly Rates

With effect from 2 April 2017, the weekly rate for statutory maternity leave, statutory paternity leave, statutory adoption leave and statutory shared parental leave is rising from £139.58 to £140.98 or 90% of the employees average weekly earnings if this figure is less than the statutory rate. This is the first increase since the rates were frozen on 5 April 2015.

Statutory Sick Pay

The rate of statutory sick pay is also increasing from £88.45 to £89.35. This increase is expected to occur on 6 April 2017.

Stay on track

Stay on track with employment law changes with our People in Focus or for details of the new rules on gender pay reporting, we are running a webinar on 23 March. To find out more or to book your place visit our events page at www.boyesturner.com/events

To discuss how this may affect your organisation please contact the Employment Group on 0118 952 7284 or at elg@boyesturner.com.

Consistent with our policy when giving comment and advice on a non-specific basis, we cannot assume legal responsibility for the accuracy of any particular statement. In the case of specific problems we recommend that professional advice be sought.

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