February 28, 2018

Raising Rates: Tribunal Compensation Limits and National Minimum Wage 2018

The annual increases in compensation in the employment tribunals will take effect on 6 April 2018. The new rates apply where the event giving rise to the compensation (such as the termination of employment) occurs on or after 6 April 2018. The most notable changes are as follows:

  • The limit on a week’s pay for the purposes of calculating statutory redundancy payments and the basic award for unfair dismissal has increased from £489 to £508
  • The maximum statutory redundancy payment and basic award for unfair dismissal have increased from £14,670 to £15,240
  • The maximum compensatory award for unfair dismissal has increased from £80,541 to £83,682
  • The maximum total compensation for unfair dismissal (i.e., the aggregate of the maximum basic and compensatory awards) has increased from £95,211 to £98,922

The minimum hourly wages are also due to increase with effect from 1 April 2018 as follows:

  • The National Living Wage for those aged 25 and above will increase from £7.50 to £7.83 per hour
  • The National Minimum Wage:
    • For those aged 21 to 24 will increase from £7.05 to £7.38 per hour
    • For those aged 18 to 20 will increase from £5.60 to £5.90 per hour
    • For those aged under 18 will increase from £4.05 to £4.20 per hour
    • For apprentices will increase from £3.50 to £3.70 per hour

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