New compensation limits and statutory payments for employment matters – April 2023

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 2023 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 for employers and employees to note:

Unfair DismissalMaximum award 6 April 2022 to 5 April 2023Maximum award 6 April 2023 to 5 April 2024
Basic Award week’s pay£571£643
Basic Award£17,130£19,290
Compensatory Award£93,878 (or 52 weeks’ actual gross pay at time of dismissal, whichever is lower)*£105,707(or 52 weeks’ actual gross pay at time of dismissal, whichever is lower)*
Minimum Combined Award£111,008*£124,997

* 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.

Other Employment RightsMaximum award 6 April 2022 to 5 April 2023Maximum award 6 April 2023 to 5 April 2024
Statutory redundancy pay: up to 30 weeks’ pay£17,130£19,290
Breach of Contract£25,000 
Failure to reinstate or re-engage: 26 to 52 weeks’ pay£14,846 to £29,692£16,718 to £33,436
Breach of right to be accompanied: up to 2 weeks’ pay£1,142£1,286
Breach of flexible working regulations: up to 8 weeks’ pay£4,568£5,144
Failure to give written particulars of employment 2 or 4 weeks’ pay£1,142 to £2,284£1,286 to £2,572
Guarantee payment (each day)£31 (subject to a maximum of five days or £155 in any three months)£35
National minimum wage1 April 2022 to 31 March 20231 April 2023 to 31 March 2024
Age 16-17£4.81£5.28
Age 18-20£6.83£7.49
Age 21-22£9.18£10.18
National Living Wage (Age 25+)£9.50£10.42
Statutory leave and payments for time off workMaximum 3 April 2022 to 2 April 2023Maximum 3 April 2023 to 2 April 2024
Maternity / Paternity leave per week (prescribed rate)£156.66£172.48
Adoption leave per week (prescribed rate)£156.66£172.48
Shared parental leave per week (prescribed rate)£156.66£172.48
Statutory sick pay per week£99.35£109.40

For more information, please contact a member of BTO’s employment law team.

This update contains general information only and does not constitute legal or other professional advice.

Kate Ross, Trainee Solicitor: 0141 221 8012 / Connect with Kate on LinkedIn

Dawn Robertson, Partner & Accredited Specialist in Employment Law: / 0131 222 3242 / Connect with Dawn on LinkedIn