The Coalition Government's recent consultation paper, Resolving Workplace Disputes issued last week, contains a proposal in Chapter IV to extend the qualification period for employees to bring a claim of unfair dismissal from one to two years.
If that proposal becomes law, it will inevitably have a significant impact on those employees who succeed in a finding of unfair dismissal and are faced with having to build up again a continuous period of two years of employment with a new employer before they qualify for unfair dismissal protection. One of the elements to be considered by an Employment Tribunal at the remedies stage of a case is what sum they should award the successful claimant for the loss of this protection from unfair dismissal. This is known as an award for "loss of statutory rights" (LOSR).
At present, the award tends to be somewhere in the region of £250 to £350. In theory, if the qualification period is doubled from one to two years, then the award for LOSR should be at least doubled to say £700.
There is no fixed and fast rule used by the Tribunal members in deciding the amount of the LOSR award. Figures vary between Tribunals, depending on the regional centre where the case is heard.
One could argue that as the maximum compensatory award for unfair dismissal creeps up (£68,400 from 1 February 2011), the value of the LOSR is higher and so the award for LOSR should be higher as well. When the maximum award for unfair dismissal was as low as £10,000 I recall LOSR awards being about £150. However, they do not appear to have increased in proportion to the increase in the cap figure for the compensatory award.
The Government consultation paper does not raise or address this issue.
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