Employment Tribunal Awards and How to Reduce Them
Employment Tribunal Awards

Employment Tribunal Awards and How to Reduce Them

In our blog series addressing all aspects of the employment tribunal process, we’ve come to the stage of employment tribunal awards. Tim Cross, Director of Employment and Legal Affairs at Vista gives us a run down of the potential argument’s employers can use to reduce them.

Firstly, if someone is unfairly dismissed, they are entitled to a basic award equivalent to statutory redundancy pay. They are also entitled to a compensatory award, which is currently capped at the lower of 52 weeks’ pay or £86,444.

Reducing Employment Tribunal Awards

A compensatory award is made up of:

  • loss of earnings
  • loss of pension rights
  • and loss of statutory rights.

As an example, compensatory awards can be reduced if the dismissal is procedurally unfair: a tribunal can assess on a percentage basis what the outcome would have been, had a fair procedure been adopted. On that basis an employment tribunal can reduce compensation by up to 100%.

Facts may also come to light that will allow us to say that, regardless of whether or not an individual had been unfairly dismissed, they would have been fairly dismissed at some subsequent later date.

When looking to reduce the compensatory or basic award, employers also have the option to argue contribution. Contribution is the extent to which a dismissal has been caused or contributed too, by an individual’s conduct, and is a matter for an employment tribunal to assess.

Consider whether the individual has taken adequate steps to mitigate his or her loss

When you do dismiss someone, it’s important that we keep a record of the type of jobs that an individual could (and should) have applied for. This is so that they can be presented in cross examination, to determine whether or not a claimant has taken adequate steps to mitigate their loss. If not, compensation can be again reduced on a just and equitable basis.

And finally, even where someone seizes an opportunity to leave based on, say, a constructive unfair dismissal – where an individual employer makes a tactical offer of reinstatement or re-engagement, agreeing to bridge the financial void between dismissal and the offer, if an individual chooses not to accept it, then there is a good argument that can be advanced that the individual has failed to take adequate steps to mitigate their loss.

For more information on the employment tribunal process, visit our blog series which covers everything from receiving an ET1 form to preparing for the hearing,  visit us at our next mock employment tribunal, or download our employment tribunal checklist, to help you navigate all the HR responses required during the tribunal process.

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