Employment & HR - colourful people chain image

Annual review of compensation limits

It’s nearly that time of year again when the government review the figures used in the calculation of compensation under Employment legislation. The change will not come into force until 1 February 2013 but, to keep you up to speed, some of the new rates are detailed below:

Old rate New rate (from 1 February 2013)
Maximum cap on a week’s pay (used
to calculate statutory redundancy and
the basic award for unfair dismissal)
£430 £450
Maximum award for the compensatory
award in unfair dismissal
£72,300 £74,200
Guarantee payments
£23.50 per week £24.20 per week

The new rates apply where the event giving rise to a compensation payment occurs on or after the 1 February 2013. By example, in the case of unfair dismissal, the effective date of termination must be on or after the 1 February 2013 for the new rates to apply. If the date is before 1 February 2013 the old rates will apply even if the ruling is made after February.