On 29 July 2013 the Unfair Dismissal (Variation of the Limit of Compensatory Award) Order 2014 came into effect.
The upshot of this Order is that the compensatory award in unfair dismissal proceedings will now be limited to 1 years’ gross salary (or to the statutory cap on compensation, £76,574 (as of 6th April 2014), whichever is the lesser amount).
At the end of 2012 the London-based employment law firm Compromise Agreements recently lodged a Judicial Review Application for this Order to be reconsidered.
The founder of Compromise Agreements, Mr Alex Monaco of Counsel, asserted that the new cap on compensation would disproportionately affect older people as they were, previously, most likely to receive more than a year’s salary in compensation due to increased difficulty in finding another job and thereby mitigating their loss.
However, on Tuesday 13th May 2014, the High Court dismissed the Judicial Review Application at a Permission Hearing.
In a recent statement Mr Monaco stated that Compromise Agreements are currently “looking at options and looking at appealing [the decision]”.
As a firm, we are of the collective opinion that this is yet a further example of the current government’s deliberate erosion of fundamental employee employment rights.
In other news the Trade Union, Unison, is also currently challenging a High Court ruling back in February 2014 which rejected a request for a Judicial Review of the Government’s decision to introduce Tribunal fees, which also came into effect on 29 July 2013. Recent statistics show that, since the introduction of Tribunal fees, the number of employment law claims has dropped sharply, with a 79% fall in the final quarter of last year compared with the same period in 2012.