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Redundancy and Unfair Dismissal Payments to be Increased

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What Cost to Your Business?

With effect from 6 April 2014 employers who make staff redundant or who face a claim for unfair dismissal will see an increase in the limits that an Employment Tribunal could award a former employee.

If you are making an employee’s post redundant, subject to the individual’s eligibility for a redundancy payment, the maximum amount of a week’s pay for the purposes of calculating the redundancy payment will increase from the current limit of £450.00 to £464.00. If you have a redundancy situation post 6 April 2014 involving an employee who earns £500.00 per week, is aged 35yrs and has 10 years complete service the redundancy payment you will have to make is £4640.00. In addition the employee will be entitled to a period of paid notice, and any accrued holiday pay as at the date of dismissal.

However if an employee is ‘unfairly’ dismissed the current maximum amount of the compensatory award that an Employment Tribunal can order the employer to pay increases from £74,200.00 to £76,574.00.

The amount an employer has to pay an employee each day if they are laid off also increases from 6 April.

If you require further information about these payments or any other employment issue please contact Annette Wood