Just in case …

Increase in statutory rates and compensation limits – from April 2019

Every year the rates payable for unfair dismissal, redundancy and other employment law claims increase in line with inflation.   We set out below the new rates and limits which have been introduced and apply to dismissals where the effective date of termination is on or after 6 April 2019.

Statutory Redundancy Payments (“SRP”)

Employees who are made redundant and have at least two years’ continuous service could be entitled to receive statutory redundancy pay.

Such payments are based on an employee’s length of service which is capped at 20 years and their age:

up to 22 years – half a week’s pay for each year of employment

from 22 years – 1 week’s pay for each year of employment

41 years and over – 1.5 weeks’ pay for each year of employmentWeekly pay is capped at the following rate:

Current weekly  rate: £508

New weekly rate: £525

Compensation for Unfair Dismissal. If an employment tribunal awards compensation to an employee for unfair dismissal, the award will consist of a basic award and a compensatory award.

 

Basic Award

This is calculated in the same way as statutory redundancy pay. The maximum basic award is therefore:

Current limit: £15,240

New limit: £15,750

Employers should note that there is a minimum basic award for dismissals based on Trade Union membership or activities, health and safety activities, being an occupational pension scheme trustee or an employee representative:

Current limit: £6,203

New limit: £6,408 

Compensatory Award

This is calculated on the employee’s gross annual salary or the statutory cap (whichever is lower):

Current limit: £83,682

New limit: £86,444

An important point to note is that there are no limits on the awards for automatically unfair dismissals i.e. discrimination or whistleblowing.

Other Important Changes

Failure to allow right to be accompanied (in a disciplianry hearing):

Current cap: £1,016

New cap: £1,050

Failure to give a written statement of particulars of the terms of employment:

Current cap: £1,016 or £2,032

New cap: £1,050 or £2,100

Flexible working regulations:

Current cap: £4,064

New cap: £4,200

If you have any queries on how the rates should be applied, please get in touch.