New compensation limits and statutory payments for employment matters – April 2022

Employment Tribunal compensation limits are a useful tool for both employers and employees in valuing potential claims for redundancy and unfair dismissal and weighing up the risks involved.

The limits increase each tax year in line with inflation and, for example, redundancies after 6 April 2022 will cost employers more.

National Minimum Wage rates and statutory payments for statutory sick leave and statutory family related leave also increase each tax year.

Here are the key changes from April 2022 onwards for employers and employees to note –

Tribunal awards – compensation limits

Employment RightsMaximum award 6 April 2021 to 5 April 2022Maximum award 6 April 2022 to 5 April 2023
Unfair dismissal  
Basic Award week’s pay£544£571
Basic award£16,320£17,130
Compensatory award£89,493 (or 52 weeks’ actual gross pay at time of dismissal, whichever is lower)*£93,878 (or 52 weeks’ actual gross pay at time of dismissal, whichever is lower)*
Maximum combined award£105,813*£111,008*
  * The limit does not apply, for example, where the reason for dismissal or redundancy selection is carrying out health and safety activities or making a protected disclosure. There is also no limit to compensation for injury to feelings in discrimination claims  
Statutory redundancy pay: up to 30 weeks’ pay£16,320£17,130
Breach of contract£25,000£25,000
Failure to reinstate or re-engage: 26 to 52 weeks’ pay£14,144 to £28,288£14,846 to £29,692
Breach of right to be accompanied: up to 2 weeks’ pay£1,088£1,142
Breach of flexible working regulations: up to 8 weeks’ pay£4,352£4,568
Failure to give written particulars of employment 2 or 4 weeks’ pay£1,088 to £2,176£1,142 to £2,284
Guarantee payment (each day)£30 (subject to a maximum of £150 in any three months)£31 (subject to a maximum of five days or £155 in any three months) 

National minimum wage and National Living Wage rates

Minimum wage rate1 April 2021 to 31 March 20221 April 2022 to 31 March 2023
Age 16-17£4.62£4.81
Age 18-20£6.56£6.83
Age 21-22£8.36£9.18
National Living Wage (Age 25+)£8.91£9.50

Statutory leave and payments for time off work

Type of leave / payMaximum 3 April 2021 to 2 April 2022Maximum 3 April 2022 to 2 April 2023 
Maternity/adoption/paternity/shared parental leave pay per week (prescribed rate)  £151.97£156.66
Statutory sick pay per week£96.35£99.35

Please get in touch with our Specialist Employment Team if you would like to discuss any of the above.

Katie Hendry, Solicitor: / 0141 221 8012 / Connect with Katie on LinkedIn

Dawn Robertson, Partner / 0131 222 2939 / Connect with Dawn on LinkedIn