Statutory Payments and Employment Tribunal Award Limits

Rates for The Tax-Year 2017-18

Statutory Payments

The Government has published the statutory rates for maternity pay, paternity pay, shared parental pay, adoption pay and sick pay from April 2017.

The rates normally increase each April in line with the consumer price index (CPI). A 0.1% fall in the CPI in the year to September 2015 meant that there was no increase to the rates in April 2016.

This means that the rates have been frozen since 5 April 2015.

However, the CPI has increased by 1% in the year to September 2016, which is reflected in the rates for 2017/18.

The rates of Statutory Payments for Tax Year 2017-18 will therefore be as follows:-

Payment

Rate

Statutory Sick Pay (SSP) The weekly rate of SSP is £89.35
Statutory Maternity Pay (SMP) The standard weekly rate of SMP is £140.98
Statutory Adoption Pay (SAP) The standard weekly rate of SAP is £140.98
Statutory Paternity Pay (SPP) The standard weekly rate of SPP is £140.98
Guarantee Pay The limit on amount of pay payable to an employee in respect of any day is £26.00

To be entitled to these statutory payments, the employee’s average earnings must be equal to or more than the lower earnings limit. This amount is increasing to £113 in April 2017.

Rates for The Tax-Year 2016-17

Statutory Payments

Statutory maternity pay and statutory sick pay rates will not rise in 2016. The Government has proposed no annual increase in various statutory rates, including maternity pay, paternity pay, shared parental pay, adoption pay and sick pay.

The rates normally increase each April in line with the consumer price index (CPI). As the CPI fell by 0.1% in the year to September 2015, there will be no increase to the rates in 2016/17.

The rates of Statutory Payments for Tax Year 2016-17 will therefore remain as follows:-

Payment

Rate

Statutory Sick Pay (SSP) The weekly rate of SSP is £88.45
Statutory Maternity Pay (SMP) The standard weekly rate of SMP is £139.58
Statutory Adoption Pay (SAP) The standard weekly rate of SAP is £139.58
Statutory Paternity Pay (SPP) The standard weekly rate of SPP is £139.58
Guarantee Pay The limit on amount of pay payable to an employee in respect of any day is £26.00

To be entitled to these statutory payments, the employee’s average earnings must be equal to or more than the lower earnings limit. This amount is also frozen at £112.

Employment Tribunal Award Limits 2017

The Government has announced the new compensation limits to be imposed by employment tribunals with effect from 6 April 2017.

The 2017 rates will apply to any relevant events occurring on or after 6 April 2017. The 2016 rates will continue to apply to any matters arising on or before 5 April 2017.

Key Changes for 2017

The new compensation and redundancy payments from 6 April 2017 are as follows:

  • The cap on a statutory week’s pay will increase to £489 (from £479).
  • The maximum Basic Award for unfair dismissal will rise from £14,370 to £14,670.
  • Statutory Redundancy Payments will be capped at a maximum of £14,670.
  • Compensatory Awards for unfair dismissal will increase to a maximum of £80,541 (from £78,962) or a year’s gross pay, whichever is lower.

The increases reflect the increase in the retail prices index of 2.0% from September 2015 to September 2016.

Bear in mind that there is still no limit to the amount that can be awarded for unfair dismissal for certain health and safety and whistleblowing reasons. In addition, there is no limit to the amount that can be awarded for discrimination claims.

Employment Tribunal Award Limits 2016

The Government has implemented a further increase to compensation payments, with the increased rates applying to any cause of action occurring on or after the 6 April 2016.

Key Changes for 2016

  • The cap on a statutory week’s pay will increase from £475 to £479.
  • The maximum Basic Award for unfair dismissal will be £14,370.
  • Statutory Redundancy Payments will be capped at a maximum of £14,370.
  • The maximum Compensatory Award for unfair dismissal will increase to £78,962 or 52 x gross weekly pay, whichever is the lower.

Bear in mind that there is still no limit to the amount that can be awarded for unfair dismissal for certain health and safety and whistleblowing reasons. In addition, there is no limit to the amount that can be awarded for discrimination claims.

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