The Government has now passed the annual legislation uplifting compensation limits and minimum pay rates for 2026. From 6 April 2026 the following will apply;
- the limit on the compensatory award for unfair dismissal, which will increase to £123,543 (this will be the last such increase since the cap on the compensatory award is to be removed for dismissal from 1 January 2027).
- the limit on a week’s pay for the purpose of calculating, among other things, statutory redundancy payments and the basic award for unfair dismissal, which will increase to £751
- the limit on the compensatory award for failure to allocate and pay tips fairly, which will increase to £5,366; and
- Statutory sick pay will rise to £123.25 per week (note also that the three day waiting period for SSP will also be abolished on this day)
From 5 April 2026 statutory maternity pay will increase to £194.32 per week.
If you have any queries relating to any of these increases or they impact upon your business please contact our Employment Team on 0345 646 0406 or by using our online enquiry form.