In March 2o25, the Employment Rights (Increase of Limits) Order 2025 set out the increased employment tribunal compensation limits and awards which will apply from 6 April 2025. The Vento Bands, which determine compensation made for injury to feelings and psychiatric injury, have also increased.
Maximum Compensation Limits
| Relevant Compensation | April 2024 Limit | April 2025 Limit |
| A week’s pay | £700 | £719 |
| Statutory redundancy payment (up to 30 weeks’ pay) and unfair dismissal basic award (up to 30 weeks’ pay) | £21,000 | £21,570 |
| Unfair dismissal compensatory award | £115,115 | £118,223 |
| Breach of flexible working regulations (up to 8 weeks’ pay) | £5,600 | £5,752 |
| Failure to give written particulars of employment (2 or 4 weeks’ pay) | £1,400 to £2,800 | £1,438 to £2,876 |
| Failure to inform or consult on collective redundancy | 90 days’ pay (actual, gross pay. The limit on a week’s pay does not apply here) | 90 days’ pay (actual, gross pay. The limit on a week’s pay does not apply here) |
| Failure to inform or consult on TUPE transfers | 13 weeks’ pay (actual, gross pay. The limit on a week’s pay does not apply here) | 13 weeks’ pay (actual, gross pay. The limit on a week’s pay does not apply here) |
Minimum Compensation Limits
| Relevant Compensation | April 2024 Limit | April 2025 Limit |
| Automatic unfair dismissal basic award | £8,533 | £8,763 |
| Blacklisted employee unfair dismissal basic award | £5,000 | £5,000 |
Vento Bands
| Band Type | April 2024 Limit | April 2025 Limit |
| Lower Band | Minimum of £1,200 to a maximum of £11,700 | Minimum of £1,200 to a maximum of £12,100 |
| Middle Band | Minimum of £11,700 to a maximum of £35,200 | Minimum of £12,100 to a maximum of £36,400 |
| Upper Band | Minimum of £35,200 to a maximum of £58,700 | Minimum of £36,400 to a maximum of £60,700 |
Furthermore, in exceptional circumstances, awards exceeding the upper band limit of £60,700 may be ordered by the tribunal.
Key points for employers
Importantly, the increased awards and compensation limits will only apply where the relevant date, such as the effective termination date in an unfair dismissal claim, falls on or after 6 April 2025. Any effective date of termination falling before this date will be subject to the lower limits of compensation, as detailed in the April 2024 columns above.
Whilst the changes to compensatory awards will be welcomed by prospective claimants, the increased financial penalties will be a point of concern for employers. To manage this risk, employers may wish to review their practices and policies, as well as ensuring that appropriate resources are available with a view to defending a tribunal claim if necessary.
Most importantly, however, employers should ensure that their routine, operational practices ae compliant with their own policies and employment law generally. This will ultimately reduce the likelihood of an employer being presented with a tribunal claim, in addition to managing the risk of dealing with the increased financial penalties.
Our Services
At Paris Smith, we understand that bringing, or being faced with a tribunal claim, can be a stressful experience. Our Employment team is experienced in acting for both employers and employees and can work with you to support and guide you throughout the process. Should you have any concerns about the increased tribunal compensation limits, or other employment law matter, please do not hesitate to get in touch with a member of the team.
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