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New compensation limits to come into force in February

Posted by simontoffel on January 11th, 2013

Clients of Employee Management Ltd (http://www.employeemanagement.co.uk) will be interested to know that increases have been announced of the limits that apply to certain awards of employment tribunals and to other amounts that are payable in accordance with employment law. Now having been published and laid before Parliament, the increments provided for in the Employment Rights (Increase of Limits) Order 2012 will come into force from 1 February 2013.

The main changes include an increase, from £430 to £450, to the maximum amount of a ‘week’s pay’ for the purpose of the calculation of a redundancy payment or the basic or additional award of compensation for unfair dismissal or payments to employees in the event of insolvency. The limit on the amount of compensatory award for unfair dismissal also increases, from £72,300 to £74,200. Meanwhile, a rise will also occur in the limit on the daily amount of statutory guarantee pay, from £23.50 to £24.20.

The increases are applicable where the events that render the employee entitled to compensation or other payment take place on or after 1 February 2013. The exact type of claim that is brought dictates how the date is determined. In the case of an unfair dismissal claim, for example, this date is the effective date on which employment was terminated, whereas as far as guarantee payment claims are concerned, it is the day in respect of which payment is due. The increases will be implemented as a result of the 2.6% rise in the retail prices index between September 2011 and September 2012.

The HR specialists at Employee Management Ltd (http://www.employeemanagement.co.uk) are seasoned at advising clients on a wide range of aspects of the latest employment legislation. Continue reading this blog for more of the latest industry news, or contact us now for pragmatic, user-friendly advice on change management, workplace investigations and more from capable specialist consultants.

Editor’s Note: Employee Management (http://www.employeemanagement.co.uk) is represented by the search engine advertising and digital marketing specialists Jumping Spider Media. Please direct all press queries to Louise Byrne. Email: louise@jumpingspidermedia.co.uk or call: +44 (0)20 3070 1959 / +34 952 783 637.