Non-payment of tribunal awards to incur financial penalty
Implementation date: 6 April 2016
The Small Business, Enterprise and Employment Act 2015 gives tribunal enforcement officers the power to levy a financial penalty against employers for failure to pay employment tribunal awards.
Section 150 of the Small Business, Enterprise and Employment Act 2015 is commenced by the Small Business, Enterprise and Employment Act 2015 (Commencement No.4, Transitional and Savings Provisions) Regulations 2016 (SI 2016/321) to amend the Employment Tribunals Act 1996 to give tribunal enforcement officers the power to impose a financial penalty against employers for failure to pay sums ordered by an employment tribunal, including costs awards and preparation time orders, employment tribunal fees and Acas conciliated settlements. The amount of the penalty will be 50% of the amount owed. The penalty is subject to a minimum threshold of £100 and an upper ceiling of £5,000. However, employers will qualify for a reduction of 50% of the penalty if they pay the reduced penalty and the whole unpaid amount within 14 days after the day on which notice of the decision to impose the penalty is sent to the employer.
This is in addition to the power of tribunals to impose a financial penalty against employers that are in breach of a worker's employment rights, which was introduced on 6 April 2014 and contained in the Enterprise and Regulatory Reform Act 2014.