Employment Tribunal Awards: Behind the Numbers
One of the most common questions we get asked in relation to Employment Tribunals is how the value for any awards is calculated. There are three components to any award – basic award, compensatory award and reductions to award.
This award is calculated using a formula that incorporates the claimant’s age, weekly pay (capped at £450) and length of continuous service (capped at 20 years).
For each year of employment under the age of 22 - ½ a week’s pay
For each year of employment between the ages of 22 to 40— 1 week’s pay
For each year of employment over the age of 41—1½ week’s pay
Compensation based award
Unlike the basic award there is no set formula for calculating whether a claimant (employee) is entitled to any compensation. The Employment Judge must carefully consider factors such as present and future loss of wages, as well as loss of pension or employment rights. For example, compensation may be awarded if a claimant is unable to find alternative employment or they have to accept a position on a lower salary.
Any compensatory award given due to unfair dismissal, must currently be capped at £74,200.
The respondent (employer) has the opportunity to put forward any arguments that they feel should reduce any award, in some cases by 100%. Such arguments may include:
- payments have already made to the claimant in the form of redundancy or notice pay
- that despite procedural errors, the claimant would still have been dismissed
- the claimant contributed to their dismissal, for example a breach of conduct
- the claimant has not made an effort to reduce their loss, for example not seeking suitable new employment
2012/13 Maximum Award Average Award
Unfair Dismissal £236,147 £10,127
Race Discrimination £65,172 £8,945
Sex Discrimination £318,630 £10,552
Disability Discrimination £387,472 £16,320
Religious Discrimination £24,004 £6,137
Sexual Orientation Discrimination £28,251 £10,757
Age Discrimination £72,500 £8,079
2012/13 Employment Tribunals and ETA Statistics, Ministry of Justice