Search

How can we help?

Icon

Increase to Tribunal Award Limits Effective from 6 April 2025

As of 6 April 2025, the Employment Rights (Increase of Limits) Order 2025 will increase the compensation limits which apply to various Employment Tribunal awards as well as other statutory payments. These adjustments reflect the annual review based on the Retail Prices Index (RPI) and aim to ensure that compensation remains fair and relevant in the context of economic changes.

Key Changes

Limit on a Week’s Pay:

  • The limit on a week’s pay, which is used to calculate statutory redundancy pay and other payments such as the basic award for unfair dismissal, will increase from £700 to £719.

Maximum Compensatory Award for Unfair Dismissal:

  • The maximum compensatory award for unfair dismissal will rise from £115,115 to £118,223. In successful claims for Unfair Dismissal, employees will receive the lower of a year’s salary or the maximum statutory limit.

Minimum Basic Award for Certain Unfair Dismissals:

  • In cases where a dismissal is deemed unfair due to certain reasons (including health and safety dismissals), the minimum basic award will increase from £8,533 to £8,763.

Limit on Compensatory Awards regarding Tips:

  • The limit on compensatory awards regarding tips including for failure to have a written tips policy, or for failure to allocate and pay tips fairly, increases from £5,000 to £5,135.
Lucy White

Senior Solicitor

View profile

+44 118 960 4655

As of 6 April 2025, the Employment Rights (Increase of Limits) Order 2025 will increase the compensation limits which apply to various Employment Tribunal awards as well as other statutory payments.

Implications for Employers

These changes will apply where the event giving rise to the compensation or statutory payment (the effective date of termination), falls on or after 6 April 2025. For employers, these changes mean that the cost of dismissals and redundancy payments will increase. This will be particularly significant to employers having to considering redundancies after 6 April 2025, who will need to factor in these increased statutory redundancy payments for employees with over two years’ service.

Implications for Employees

For employees, the increase in tribunal award limits is generally positive. Higher compensation limits mean that employees who are unfairly dismissed or made redundant will receive more substantial financial awards. This can provide greater financial security and support during periods of unemployment.

Employees should be aware of their rights and the new compensation limits when negotiating settlements or pursuing claims. Understanding these changes can empower employees to seek fair compensation and ensure that they are adequately compensated for any unfair treatment or dismissal.

Please do not hesitate to contact a member of our employment team who will be happy to help.

 

About this article

Disclaimer
This information is for guidance purposes only and should not be regarded as a substitute for taking legal advice. Please refer to the full General Notices on our website.

Lucy White

Senior Solicitor

View profile

+44 118 960 4655

About this article

Read, listen and watch our latest insights

art
  • 21 May 2025
  • Employment

The Rise of Side Hustles and Polygamous Working

In the evolving world of work, the rise of side hustles and “polygamous working” is reshaping the employment landscape in the UK.

Pub
  • 16 May 2025
  • Employment

London Seminar – Understanding the Employment Rights Bill: Legal changes and what they mean for HR

We are pleased to invite you to an in-person seminar at our London office on Tuesday 24th June, hosted by our Employment Law team. Join Monica Atwal, Managing Partner; Katie Glendinning, Partner; and Amanda Glover, Associate, as they unpack the legal implications of the new Employment Rights Bill and what it means for your organisation.

Pub
  • 16 May 2025
  • Employment

Reading Seminar – Understanding the Employment Rights Bill: Legal changes and what they mean for HR

We are pleased to invite you to an in-person seminar at our Reading office Tuesday 17th June hosted by our Employment Law team. Join Monica Atwal, Managing Partner, Katie Glendinning, Partner and Amanda Glover, Associate, will unpack the legal implications of the new Employment Rights Bill and what it means for your organisation.

Pub
  • 15 May 2025
  • Employment

TUPE Podcast Series – Information and Consultation Obligations

In this ninth episode of our TUPE Podcast Series, Katie Glendinning, a Partner in the employment team, will examine the information and consultation obligations under TUPE.

Pub
  • 12 May 2025
  • Employment

Talking Employment Law: The Employment Rights Bill – Part 2

In part two of the Employment Rights Bill podcast series, Louise Keenan and Melanie Pimenta, members of the employment team, will discuss changes to collective redundancies, flexible working and sick pay.

art
  • 08 May 2025
  • Employment

Statutory Sick Pay Scheme changes: how can employers prepare for such changes?

The government has recently changed the Statutory Sick Pay provisions; it is anticipated that such changes will ‘help people to stay in work and grow the economy’.