Making a claim in the Employment Tribunal

Read our step-by-step guides to help you understand and manage the employment tribunal process.

When case management orders are put in place by the tribunal, they will usually include a schedule of loss. This is what the claimant has to submit to set out the value of their claim. In this article, we will look at the different types of awards that are issued for different claims so you have an idea of the level of compensation you could receive if your claim is successful.

Basic and Compensatory Awards

A basic award is the first tier of the calculation. It is intended to compensate claimants for the fact that they were dismissed. It is calculated in the same way as a statutory redundancy payment, and is therefore dependent on your age, length of service and weekly pay (subject to an upper limit which is currently £571 per week for the year 2022/2023). Please note, if you were made redundant and paid your statutory redundancy pay, this would replace the basic award because it has already been paid to you.

Certain types of ‘automatically unfair dismissals’ attract a minimum basic award currently set at £6,959.

The total basic award is capped at £17,130 (this is likely to increase as of April 2023) which means that it is the maximum basic award that can be claimed for unfair dismissal.

A compensatory award is the second tier of the calculation. This calculation differs between unfair dismissal claims and discrimination claims.

This type of award is in place to compensate claimants for the losses that arose as a result of the dismissal and/or discriminatory treatment.

• It will cover past losses, calculated from the point of dismissal up until the tribunal hearing – this usually includes lost income, pension benefits, bonuses/commission etc.
• The next part covers future losses – so these are losses that have not yet incurred but will do as a result of your dismissal. Future losses are usually capped at one year of income and again, covers things such as: loss of income, pension benefits and other contractual benefits.
• For discrimination or detriment claims, if you remain employed at the time of bringing your claim, you can also include losses arising out of the discrimination or detrimental treatment that continue to affect you (e.g. if you were not given a pay rise or bonus or overlooked for a promotion etc.)

In unfair dismissal claims, the maximum compensatory award is capped at £93,878 (this is likely to increase as of April 2023). However, there is no upper limit for discrimination claims which means the awards are uncapped and decided at the tribunal’s discretion.

For discrimination and detriment claims, there is another layer to the calculation which is for ‘injury to feelings’ and in exceptional cases, ‘aggravated damages.’ So what does that mean?

• Injury to Feelings: This is to compensate for the harm and personal impact caused by the discriminatory treatment. The level of award is based on a three tier system, known as the Vento bands which is categorized into a lower, middle and upper banding. The 2022 rates and limits are as follows:

• Aggravated damages – these are rare but can be awarded where there are aggravating factors such as the employer deliberately discriminating against you while knowing it was against the law or where they have acted maliciously.

Additional Considerations

• When calculating the compensatory award, claimants have an ongoing duty to mitigate their losses. That means you must be able to show that you have taken steps to minimise your financial losses by trying to find another job.
• In certain situations, you can claim for an uplift of up to 25% on the compensatory award where the company has failed to comply with the ACAS Code of Practice.
• Your conduct will also be taken into consideration; so if the tribunal decides that you contributed towards your dismissal (e.g. by committing an act of misconduct), your award can be reduced on a percentage basis. This is known as a contributory fault.

Will the claim settle?

Every tribunal claim will come with its own litigation risk. Your legal advisor will regularly review your prospects of success but legal claims of any nature can be highly unpredictable and there is never going to be 100% certainty of success. While some employers will engage in settlement discussions to avoid public exposure or to achieve an amicable resolution, there is no guarantee that this will happen.

Cost proportionality is also key. If the costs of pursuing the claim are greater than the value of it, it is probably not worth doing. So if we think the odds are not in your favour or if your legal costs are likely to outweigh any possible award, we will talk through your options.

How can the claim be settled?

Claims can usually be settled in one of two ways:

1. COT3 agreement – this is done with the assistance of an ACAS conciliator. These agreements are not usually very long but they will cover the compensation payments and any additional obligations that you must follow. While it is not mandatory to have legal advice on these agreements, it is highly recommended that you do seek legal advice so that you understand the implications of accepting the terms and what impact it can have on you in the future. More importantly, having a legal advisor means you can negotiate and protect your position too.

2. Settlement agreements – these are lengthier documents which cover the payments, your obligations, the company’s obligations, additional restrictions etc. Unlike a COT3 agreement, you are required to have independent legal advice on the terms and effects of a settlement agreement for it to be legally binding but the company will usually contribute towards the cost of that advice.

How can we help?

At Bhayani Law, we can help you to calculate the value of your claim to ensure that no key elements are missed out and work with you to achieve a settlement that’s right for you.

To speak with one of our legal advisors please contact us today on 0333 888 1360.

For advice or for a free assessment contact us today