Compensatory award limit for unfair dismissal amended

Implementation date: 29 July 2013

The Enterprise and Regulatory Reform Act 2013 (PDF format, 1MB) (on the UK legislation website) gives the Secretary of State the power to amend the maximum amount of the unfair dismissal compensatory award. The Act prescribes that the amount may be no less than the median annual earnings and no more than three times the median annual earnings, or no less than 52 times the claimant's weekly pay. The Unfair Dismissal (Variation of the Limit of Compensatory Award) Order 2013 (SI 2013/1949) (on the UK legislation website) introduces an individual cap of 12 months' pay, which will apply where this amount is less than the overall cap. The order will not apply where the effective date of termination is on or before its implementation date.