The Employment Appeal Tribunal has held in the case Fox v British Airways Plc that a lost death in service payment may form part of compensation following unfair dismissal.
What does this mean?
The estate of an employee who is unlawfully dismissed, and dies shortly after, can bring a claim for loss of a death in service benefit. Usually, the amount recoverable by an employee will be the cost of the insurance premium. However, in this case it was held that the employee would not have had chance to take out such a policy because he died soon after dismissal and was undergoing serious medical treatment in the three weeks beforehand. So his estate was awarded the amount that would have been paid out on his death.
What should employers do?
Employers should be aware that loss of death in service benefit will form part of the compensation on unfair dismissal.