The Employment Rights (Increase of Limits) Order 2018 will come into force on 6 April 2018. It provides that certain compensation limits will be increased from this date.
The changes are as follows:
- The limit on the compensatory award for unfair dismissal will rise from £80,541 to £83,682, which means that the maximum amount that an Employment Tribunal can award for an unfair dismissal claim is £83,682 or one year’s gross pay whichever is lower.
- The limit on the maximum week’s pay for the purposes of calculating statutory redundancy payment and unfair dismissal basic award will increase from £489 to £508.
The new rates take effect where the ‘appropriate date’ for the course of action, such as the date of termination in an unfair dismissal claim, falls on or after 6 April 2018. In cases where the date of termination falls before 6 April 2018, the old limits will continue to apply.