The annual increase in compensation limits for claims in the Employment Tribunal (effective from 1st February 2007) has been announced.

The Employment Rights (Increase of Limits) Order 2006 increases compensation in line with the increase in the Retail Price Index from September 2005 to September 2006.

The increases apply where the event giving rise to the entitlement to compensation (e.g. dismissal) or other payments occurs on or after 1st February 2007. The limits previously enforced are preserved by the Order in relation to cases where the relevant event was before that date.

In particular, the main changes are:

  • the limit on the compensatory award for unfair dismissal will increase from £58,400 to £60,000;
  • the maximum amount of a "week's pay" for the purposes of calculating the basic or additional award of compensation for unfair dismissal or redundancy payments will increase from £290 to £310.

A table of the increase of limits and a copy of the Order can be accessed by clicking here

This article was written for Law-Now, CMS Cameron McKenna's free online information service. To register for Law-Now, please go to

Law-Now information is for general purposes and guidance only. The information and opinions expressed in all Law-Now articles are not necessarily comprehensive and do not purport to give professional or legal advice. All Law-Now information relates to circumstances prevailing at the date of its original publication and may not have been updated to reflect subsequent developments.

The original publication date for this article was 27/11/2006.