06th March 2017

Cap On a Week's Pay for Statutory Redundancy Pay Increases from 6th April 2017

The Employment Rights (Increase of Limits) Order 2017 SI 2017/175 will increase the compensation limits and minimum awards that are payable under employment legislation from 6 April 2017.

The limit most frequently used by employers is the cap on a week’s pay which is used for the calculation of statutory redundancy pay (and the basic award for unfair dismissal). This will increase from £479 to £489 (this figure is also used as the basic award for unfair dismissal).

Other changes include:
  • An increase to the limit on compensation for unfair dismissal from £78,962 to £80,541
  • Guarantee pay will increase from £26 to £27 per day
  • The minimum basic award in cases where a dismissal is unfair by virtue of health and safety, employee representative, trade union, or occupational pension trustee reasons will increase from £5,853 to £5,970
The new rates take effect where the ‘appropriate date’ for the claim (such as the date of termination in an unfair dismissal claim) falls on or after 6th April 2017. Where the appropriate date falls before 6th April, the old limits will still apply, irrespective of the date on which compensation is awarded.

Update by Deborah Scales
If you would like further information about this or any other employment law matters contact our employment lawyers Deborah Scales or Daniel Stander on 0808 168 5550 or at
For further information please get in touch with our dedicated team.

You can always call us on 0845 894 1622 or email on


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