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Latest NewsEmployee relationsEmployment tribunals

Employment tribunal compensation increases announced

by Mike Berry 22 Dec 2004
by Mike Berry 22 Dec 2004

The annual increases in maximum limits of compensation awardable by employment tribunals have been announced by the DTI.

These will take effect from 1 February 2005 under the Employment Rights (Increase of Limits) Order 2003.

The headline increases are:



  • The maximum compensation for unfair dismissal is to be increased from £55,000 to £56,800;
  • The maximum amount of “a week’s pay” (for calculating statutory redundancy pay or the basic award for unfair dismissal) is to be increased from £270 to £280.
  • The minimum basic award a tribunal can make for certain defined dismissals (relating to certain employee representative, health and safety and working time cases) will rise from £3,600 to £3,800.

The increased compensation rates will apply to dismissals taking place on or after 1 February 2005. This means that if an employee is dismissed before 1 February then the old rates will apply, even if the tribunal hearing takes place after that date.

However, if notice is given before 1 February but the notice period will expire on or after that date, the new limits will apply.

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Mike Berry

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