When an employee is unfairly dismissed from their job, it can cause a great deal of stress and hardship. Fortunately, in many cases, employees can seek compensation for their unfair dismissal through what is known as a compensatory award. This award is designed to help make up for the financial losses and other damages suffered as a result of being unfairly dismissed. In this article, we will take a closer look at what the unfair dismissal compensatory award involves and how it is calculated.
The unfair dismissal compensatory award is a financial payment that is made to employees who have been unfairly dismissed from their jobs. The purpose of this award is to help compensate the employee for the financial losses and other damages that they have suffered as a result of their unfair dismissal. In addition to providing financial compensation, the award also serves as a deterrent to employers who may be tempted to unfairly dismiss employees in the future.
There are several factors that are taken into account when determining the amount of the compensatory award. These factors include the employee’s length of service with the company, their age, their salary at the time of dismissal, and the circumstances surrounding their dismissal. In general, the compensatory award is designed to put the employee in the same financial position that they would have been in if they had not been unfairly dismissed.
It is important to note that there is a maximum limit on the amount of the compensatory award that can be awarded. In the UK, the maximum compensatory award for unfair dismissal is currently £88,519, or 52 weeks’ gross pay, whichever is lower. This means that even if an employee has suffered significant financial losses as a result of their unfair dismissal, the amount of the compensatory award may be limited by this cap.
In addition to the compensatory award, employees who have been unfairly dismissed may also be entitled to other forms of compensation, such as a basic award or a protective award. The basic award is a statutory payment that is calculated based on the employee’s age, length of service, and weekly pay, while the protective award is designed to compensate employees who have not been consulted properly in the event of a mass redundancy.
In order to claim an unfair dismissal compensatory award, employees must first lodge a claim with an employment tribunal. The tribunal will then consider the evidence presented by both the employee and the employer, and determine whether the dismissal was unfair. If the tribunal finds in favor of the employee, they will then calculate the amount of the compensatory award that is due.
When calculating the amount of the compensatory award, the tribunal will take into account a variety of factors, including the employee’s financial losses, the impact of the dismissal on their career prospects, and any additional damages suffered as a result of the unfair dismissal. The aim is to ensure that the employee is adequately compensated for the losses that they have suffered, both financial and non-financial.
In conclusion, the unfair dismissal compensatory award is an important form of compensation for employees who have been unfairly dismissed from their jobs. This award is designed to help make up for the financial losses and other damages that have been suffered as a result of the unfair dismissal. By seeking compensation through an employment tribunal, employees can hold their employers accountable for their actions and ensure that they are fairly compensated for the harm that has been done.