Basic Award | Unfair Dismissal

The Basic Award is calculated by taking the employee's age, years of service and average weekly pay to arrive at a figure.

However, the weekly pay figure is limited to a maximum of £700 per week, (this applies from 6th April 2024) and the maximum years that will be considered is 20. However, the years of service also depend upon the age of the employee.

This is how it is calculated in detail.

1. For each year of service below the age of 22, you will receive half a week's pay for each year.

2. For each year of service not below the age of 22, the weekly pay is multiplied by 1

3. For each year of service not below the age of 41, the weekly pay is multiplied by 1.5

Therefore the absolute maximum that can be awarded is:

20 years at £700 x 1.5 = £21,000.

Basic Award Deductions
The tribunal will reduce the Basic Award in the following circumstances:

1. If the employee refuses an offer to be reinstated and it is unreasonable to refuse the offer.

2. The employee is partly to blame for their dismissal.

3. Conduct before the employee was dismissed, this does not have to be linked with the actual dismissal. The conduct can still be taken into account if it is discovered after the dismissal.

4. Redundancy payments already paid to the employee where the dismissal was due to redundancy.

5. Ex gratia payments expressly or impliedly connected to the basic award.

Compensatory Award | Unfair Dismissal

Employment Law