February 2012 employment law changes: five things employers need to know

Are you wondering how the 1 February change in award limits and amounts payable under employment law may affect your business? Personnel Today sets out five things that employers need to know about the new award limits coming into force. The new limits are applicable where the event that gives rise to the award or payment occurs on or after 1 February 2012.

1. Statutory redundancy payment increases

The cap on a week’s pay for calculating statutory redundancy increases from £400 to £430 on 1 February. The new maximum statutory redundancy pay is £12,900.

2. Unfair dismissal basic award increases

An award of compensation for unfair dismissal is made up of a basic award as well as a compensatory award. The limit on a week’s pay for calculating the basic award for unfair dismissal increases from £400 to £430 on 1 February. The basic award is calculated in the same way as statutory redundancy pay, so it is based on the employee’s age, length of service and earnings.

3. Unfair dismissal compensatory award increases

The maximum compensatory award for unfair dismissal increases from £68,400 to £72,300 on 1 February. However, no maximum applies in certain circumstances, for example where the dismissal is for making a protected disclosure.

4. A “week’s pay” increases for other compensation

The increase to the statutory cap on a week’s pay from £400 to £430 on 1 February will raise the limit on certain other awards a tribunal can make. These include the award for refusing to allow an employee to be accompanied at a disciplinary or grievance hearing, and for failure to follow the statutory procedure in relation to a request for flexible working.

5. Guarantee payment increases

The limit on the guarantee payment for a “workless day” rises from £22.20 to £23.50 on 1 February. A workless day is one where the employee is not provided with work throughout a day or shift on which they are normally required to work.

Coming soon

More key employment law developments are coming into force in 2012, including an increase in the qualifying period for unfair dismissal claims. Keep up to date with all the forthcoming changes using the XpertHR legal timetable and HR calendar.

Full details of the 1 February changes are available in the XpertHR quick reference guide.

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