Remember statutory redundancy pay has gone up

Published: 1st October 2009

Remember that statutory redundancy payments have gone up for dismissals effective from today, 1^st October. As was announced by the Government in the budget earlier this year, a maximum week's pay for calculating statutory redundancy pay has increased to £380 (from £350). This means that the maximum statutory redundancy payment will now be £11,400 (for someone with 20 years service all when aged over 41).

By way of example, an employee with two years' service, both when aged under 41, will receive a redundancy payment of £760, an increase of £60.

The same increases apply to the basic award for unfair dismissal. Whilst these are significant increases now, due to the rate of inflation there will be no further increase to either the amount of a week's pay or to the maximum compensatory award next February (when they usually would increase). The maximum compensatory award for unfair dismissal will remain at £66,200, meaning that the highest possible unfair dismissal award where there is no additional element to the claim such as discrimination or whistle-blowing, will be £77,600.

If this does raise any issues for your organisation please do speak to your usual contact in the Mace & Jones Employment and HR team in Liverpool: 0151 236 8989 or Manchester: 0161 214 0500.