As you will be aware, the statutory limit on a week’s pay for unfair dismissal and statutory redundancy payments is increased annually, with effect from 1st February.

You may recall in the recent Budget, however, the announcement that there would be another increase in the limit this year, from £350 to £380 for the purposes of calculating statutory redundancy pay. In this regard, the government has recently confirmed that this will apply where the effective date (for example, of dismissal) occurs on or after 1st October 2009 and will also apply to other things to which the weekly limit also applies, for example, the basic award for unfair dismissal. As a result the maximum statutory redundancy payment/basic award will rise from £10,500 to £11,400.

In view of this additional increase, the limit will not be adjusted again in February 2010 (in line with the retail prices index for September 2009), as would normally be the case.