Statutory rates and compensation limits

Accurate as of 1 January 2023, this summary confirms the limits on compensation, family friendly and statutory sick pay as well as national minimum wage.

Compensation calculations

Redundancy pay

To qualify for a redundancy payment, an employee must have two years’ continuous employment. A redundancy payment is calculated as:

Half a week’s pay for each complete year of employment for which the employee was aged 21 or under.
One week’s pay for each complete year of employment for which the employee was aged 22 – 40.
One and a half weeks’ pay for each complete year of employment for which the employee was aged 41 or over.

Redundancy pay is capped at 20 weeks.

Unfair dismissal

An award for unfair dismissal is made up of two parts.

1. Basic award

This is calculated in the same manner as a redundancy payment, as above.

2. Compensatory award

The maximum compensation award, an employment tribunal will usually award is one year’s gross pay. The payment covers the time between the dismissal and obtaining new employment at the same level. The employment tribunal will estimate how long it will take for an individual to start new employment and claimants will be required to provide mitigating documents, such as benefits received, or any temporary work undertaken. A compensatory award may be reduced if the Claimant contributed to their dismissal in any way, for example by failure to attend disciplinary meetings without a good reason.

Discrimination

An award for a successful discrimination claim will be calculated with reference to the injury feeling guidelines below.

Compensation limits

Payment	From 6 April 2022
Maximum week’s pay for calculating redundancy and unfair dismissal basic award	£571
Maximum basic award for unfair dismissal and statutory redundancy payment	£17,130 (30 weeks’ pay, subject to the limit on a week’s pay above)
Minimum basic award for dismissal on trade union, health and safety, occupational pension scheme trustee, employee representative and on working time grounds only	£6,959
Maximum compensatory award for unfair dismissal (note: certain automatic unfair dismissals do not have a cap, such as health and safety and whistle blowing	£93,878
Failure to comply with reinstatement or re-engagement order	£14,846 – £29,692 (26-52 weeks’ pay maximum)
Employees excluded/expelled from trade union	£10,628
Failure to allow right to be accompanied correctly	£1,142 (two weeks’ pay capped at the statutory amount
Failure to give written statement of particulars	£1,142 or £2,284 (two or four weeks’ pay capped at the statutory amount)
Breach of the flexible working regulations	£4,568 (eight weeks’ pay capped at the statutory amount)
Personal injury compensation Lower band: less serious matters Middle band: cases which do not merit an upper band award Upper band: the most serious cases	Lower band: £990-£9,900 Middle band: £9,900-£29,600 Upper band: £29,600-£49,300 Exceptionally serious cases may exceed the cap

Family friendly payments

Payment	From 3 April 2022	From 2 April 2023
Statutory maternity pay The first six weeks are 90% of the employees’ average weekly earnings. The following weeks are the lower of the rate or 90% of the employees’ weekly earnings.	£156.66	£172.48
Statutory adoption pay The first six weeks are 90% of the employees’ average weekly earnings. The following weeks are the lower of the rate or 90% of the employees’ weekly earnings.	£156.66	£172.48
Statutory paternity pay Paid for two weeks	£156.66	£172.48
Statutory shared parental leave pay	£156.66	£172.48

Statutory sick pay

Statutory sick pay (SSP) is a weekly payment made to employees who earn an average of at least £120 per week and who are too ill to work. It is payable from the employee’s fourth day of sickness absence; the first three days of absence are not covered by the scheme. The current SSP rate is £99.35 per week and is payable for up to 28 weeks. From 2 April 2023, the weekly rate shall be £109.40.

National Living wage and National Minimum wage

Age	From 1 April 2022	From 1 April 2023
Under 18 and apprentices	£4.81	£5.21
18 to 20	£6.83	£7.49
21 to 22	£9.18	£9.18
23 and over	£9.50	£10.42

Apprentices are entitled to the apprentice rate if they are under 19 or aged 19 or over and in the first year of their apprenticeship. Should either of these not apply the apprentice is entitled to minimum wage for their age.