With effect from 6 April 2014, the maximum unfair dismissal compensatory award will increase from £74,200 to £76,574. Should employers lose sleep? Not really – the 29 July 2013 cap of a year’s pay still applies to those who earn less than £76,574 per year which means the change will only affect claims made by a very small number of highly paid employees.
Of more concern to employers, is the cap on a week’s pay which will increase on 6 April 2014 from the current £450 to £464. This may seem a strange number and strange date to experienced HR practitioners used to nice round numbers – £400, £430, £450 etc. which increase on 1 February each year. This figure is now index linked and reflects the 3.2% rise in the RPI and will in future rise on 6 April rather than 1 February.
A full list of the increases can be seen in the Increase in Limits Order 2014.