It has been announced that the limits on certain tribunal awards and other sums payable under employment legislation will be increasing.
The changes that will be of most interest to employers are:
- The limit on a week’s pay which is relevant for such things as statutory redundancy pay calculations, is increasing from £700 to £719.
- The limit on the daily rate for a guarantee payment is increasing from £38 per day to £39. Guarantee pay is payable, subject to qualifying conditions, for a completely workless day during a period of short time working/lay-off. It’s limited to five days in any three month period.
- The maximum compensatory award for unfair dismissal is increasing from £115,115 to £118,223. However, the majority of employees will not be able to receive sums in the region of that amount. This is because the rules regarding the compensatory award mean that the employee is limited to receiving whichever is the lower of £115,115 (increasing to £118,223) or one year’s salary. However, there are some exceptions, for example whistleblowing cases, where there is no limit on the amount of compensatory award that can be ordered.
The new limits will be applicable where the event that gives rise to the award or payment occurs on or after 6th April 2025.
Reminder
You may remember from our earlier Legal Updates that there will also be increases to the national minimum wage rates and statutory family leave and sickness payments in April.
If you have an HR issue your business would like assistance with, please do not hesitate to get in touch.