Maximum unfair dismissal compensation award - historical data

The compensatory award for successful unfair dismissal claims is based on the tribunal's assessment of the employee's loss of earnings. Prior to the coming into force in October 1999 of s.34 of the Employment Relations Act 1999, the compensation was subject to a statutory maximum of £12,000, and the annual uplift in the maximum was a matter for individual ministerial decision. The Act increased the maximum unfair dismissal compensatory award from £12,000 to £50,000, and replaced the discretionary power to review the limit with a specific mechanism linked to inflation. The amount changes each year in line with the retail prices index (RPI) for September of the previous year and, in July 2013, a further change was made to limit the award to the claimant's annual pay where this is less than the overall amount.¹