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ORDERS AND AWARDS OF COMPENSATION
Order for Reinstatement
or Re-engagement
In deciding whether to make an order that the employer should
reinstate the employee in the same job or re-engage the employee under a new
contract of
employment,
the tribunal will take into account:
- the employee's wishes;
- whether it is practicable for the employee to return
to work for the employer (there may, for example, be circumstances in which
it is not practicable
because
relationships at the work place have been seriously damaged);
- in cases
where the employee was partly to blame for the dismissal, whether or not
it would be just to make such an order.
Where a tribunal orders the reinstatement or re-engagement of an employee
who was dismissed without statutory dismissal and disciplinary procedures
having
been followed by the employer, and where failure to follow them was wholly
or mainly the employer's fault, it will also award four weeks' pay to the
employee (unless it considers that this would result in injustice to the
employer).
If the employer fails to comply with the terms of an order for reinstatement
or re-engagement the tribunal, on being notified of the failure, will
make an award of compensation calculated in the ordinary manner provided
for in
the legislation
(subtracting the award of four weeks' pay described in the previous paragraph).
Also the tribunal will make an additional award of compensation to be
paid by the employer, unless the employer satisfies the tribunal that
it was not
practicable
to comply with the order for reinstatement or re engagement as the case
may be.
Calculating Employment Tribunal Awards of Compensation
Compensation is made
up of both a Basic award and a Compensatory award calculated as follows:
Basic
award
The basic award is calculated in a similar method as a statutory redundancy
payment by adding up the following amounts, but only continuous employment
within the
last 20 years can count:
- 1½ weeks' pay for each complete year of
employment when an employee was between the ages of 41 and 65 inclusive;
- 1 week's pay for each complete year of employment when an employee was
between the ages of 22 to 40 inclusive;
- ½ week's pay for each complete year of employment when an employee
was below the age of 22.
The maximum number of weeks' pay that may be awarded
is 30. There is also a maximum week's pay that can be used to calculate the
award.
The limit on
a
week's pay
may vary from year to year: the current figure is £280.
- In
trade union, health and safety, employee representative, workforce
representative and occupational pension scheme trustee cases (see
Interim Relief above), there
is a minimum figure for the basic award. This minimum may vary
from year to year.
The basic award, including the minimum award in trade
union and health and
safety cases, can be reduced if the employee:
- contributed to some
extent to the dismissal, or his or her conduct prior to the dismissal otherwise
justified the reduction;
- was within a year of age 65 at the effective date
of termination;
- unreasonably refused an offer of reinstatement or unreasonably
prevented the employer from complying with an order of reinstatement;
- has
already been awarded or has received a redundancy payment;
- has been awarded
any amount in respect of the dismissal under a designated dismissal procedures
agreement.
Where an employee has been dismissed without Statutory Dismissal
and Disciplinary Procedures having been followed where they should
have
been (if failure
to follow them was wholly or mainly the employer's fault) and the
amount of the
basic award
is less than four weeks' pay (before any reduction for the last
two reasons above), the tribunal will increase it to four weeks'
pay unless
it considers
that this
would result in injustice to the employer.
Compensatory Award
This award compensates the employee for
the loss suffered as a result of the dismissal insofar as the employer is responsible
for this
loss. As well
as
covering loss of earnings between the dismissal and the hearing
and an estimate of future
loss, the tribunal will also consider matters such as loss of
pension
and other rights and any reasonable expenses incurred by the
employee as a result
of
the dismissal.
The compensatory award is an amount the tribunal
considers just and equitable in the circumstances, but there is a maximum compensatory
award except
in cases where the reason for the dismissal is that the employee
made a protected
disclosure
under the Public Interest Disclosure Act 1998 or took action
relating to Health and Safety. The maximum compensatory award
may vary from
year to year:
the
current figure is £56,800. The tribunal will reduce the
award if it finds that the employee was partly to blame for the
dismissal
or the
employee did
not mitigate
his or her loss: for example, by failing to make a reasonable
effort to obtain another job. Certain payments made by the employer
to
the employee, for example
wages in lieu of notice or an ex gratia payment, will normally
result in a reduced compensatory award. The compensatory award
will also
be reduced by
the amount
of the employee's earnings from any other employment between
the dismissal and the tribunal hearing.
Under the Statutory Dismissal
and Disciplinary Procedures provisions, if an employer dismisses
an employee without the statutory procedures
having
been
completed
where they applied and are not treated as having been complied
with, and the failure to complete them was wholly or mainly the
employer's
fault, any
compensatory
award will be increased by at least 10 per cent and up to 50
per cent. Similarly, if the procedures were not completed and
the fault
lay wholly
or mainly with
the employee, any compensatory award will be reduced by 10 to
50 per cent. At what point on the scale between 10 and 50 per
cent
to make
the increase
or reduction
is at the tribunal's discretion, and in exceptional cases it
will be able to make one of less than 10 per cent or none at
all.
Additional Award
This award compensates the employee for
the additional loss suffered because of the employer's failure to comply with
a tribunal's
order for reinstatement
or re-engagement. The additional award will be between 26 and
52 weeks' pay. There is a maximum week's pay that can be used to calculate
the
additional award. The limit on a week's pay may vary from year to year:
the current
figure is £280.
Note: Employment tribunals may however exceed these limits
if the total compensation awarded (apart from the basic award) would
otherwise
be
less than the arrears
of pay element of the original award with which the employer
failed to comply.
Interest on Tribunal Awards
Legislation provides that an employer who does not pay the
compensation awarded by the tribunal within 42 days of
the tribunal's decision,
will be required
to pay simple interest on the amount outstanding.
However, in relation to awards in cases of discrimination
on the grounds of sex, race and disability, interest
begins to
accrue from the day
after the
day on
which the tribunal's decision is sent to the parties.
However no
interest will be payable if the full amount of the award
is paid to the complainant
within
14 days of the decision being sent out.
Awards of Costs
Costs (expenses in Scotland) are not normally awarded
in employment tribunal cases. They can be, however,
if the
tribunal decides
that a party has
acted frivolously, vexatiously, abusively, disruptively
or otherwise unreasonably
in bringing or
conducting the case. Costs of an adjournment or postponement
may also be awarded when the adjournment or postponement
was requested
at the
last minute
by either
party with no good reason or where it is necessary
because a party has not come prepared to deal with issues which
may be
expected
to arise
at the hearing.
Financial Assistance for Tribunal Hearings
Legal aid is
not available at employment tribunals, but some employees may be able to
claim a limited amount
of free advice
under the
legal advice and
assistance
scheme. This does not cover the cost of a legal representative
at the hearing.
The Equal Opportunities Commission
and the Commission for Racial Equality may also provide assistance in
certain cases concerning
alleged discrimination
and/or discriminatory practices in the workplace.
Allowances
are available from the tribunal office to cover the cost of travel to a hearing
and other
expenses
both
to the claimant
and
respondent,
to the
witnesses called and to representatives, including
members of Citizens Advice Bureaux,
but not full-time officials of employers' organisations
or trade unions, barristers or solicitors or
any other paid
or unpaid
professional person
or organisation
or organisations who represent parties as opposed
to acting as their witnesses. Loss of earnings
may also
be paid up
to a maximum.
The
tribunal can provide
details of the current rate on the day of a hearing.
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