The government has announced the annual increase in compensation limits for employment tribunal awards and other statutory payments.
They are contained in The Employment Rights (Increase of Limits) Order 2026.
The two key increases are:
- maximum compensatory award for unfair dismissal: £118,223 to £123,543.
- limit on a week’s pay: £719 to £751.
The changes are due to take effect for dismissals on or after 6th April 2026.
And remember that (subject to the relevant statutory instrument being passed and the exact date being confirmed) any limit on the compensatory award for unfair dismissal is being abolished for dismissals occurring in or after January 2027. Other caps (in particular a week’s pay for the basic award and statutory redundancy payments) will remain.