The Government has raised the compensation tribunals award from a paltry pounds 12,000 to a well-worth-chancing-it pounds 50,000. More tribunal cases are likely as a result.
This means negotiating settlements may be trickier now. The winnings an employee could expect are more difficult to predict, so it's hard for employers to know what severance package to offer. At the same time, the raised payout equals raised expectations: employees will be demanding more cash to go away.
Employers can optimise their chances of success at a tribunal by updating disciplinary, poor performance and redundancy procedures regularly and training managers properly (many claims are lost because the procedure was at fault). Hold regular, honest appraisals. It's hard to convince a tribunal that an employee performed poorly when their most recent appraisals score them as competent.
Michael Burd and James Davies at Lewis Silkin, solicitors. e-mail: firstname.lastname@example.org.