By Lyndsey Hall
From April 6, the government is increasing statutory redundancy pay and the amount of compensation that employment tribunals can award for unfair dismissal.
The new limits apply to the weekly wage caps on certain payments, such as redundancy pay, as well as certain types of payments that an employment tribunal can award. The statutory redundancy payment cap will rise from £464 to £475 per week. As a result, an employee made redundant on or after 6 April 2015 will be able to receive a maximum amount of £14,250 in statutory redundancy pay. The maximum compensatory award for unfair dismissal will increase from £76,574 to £78,335.
The increase will compensate claimants for loss of job security and earnings, including salary, pension and other benefits. However, it is only available to employees who have worked for a company for 2 years or more, and is on a sliding scale relating to age and service:
- 0.5 week’s pay for each full year of service while they were under 22
- 1 week’s pay for each full year of service while they were between 22 and 40
- 1.5 week’s pay for each full year of service while they were 41 and over
(Information from Acas)
In addition, the amount is subject to an upper limit and a maximum length of service of 20 years, so if you have worked for the company any longer you could lose out if you are made redundant.
If you need advice about employment issues, speak to an advisor or leave a Comment.
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