Failed Attempt to Avoid Compensation Uplift in Employment Tribunal

The case of Arrow & Sons v Onley established that employers could avoid an uplift to compensation claims if there is no award to be made. Relying on this case, The University of the Arts London v Rule tried (but failed) to avoid a 45% uplift on a large award by transferring the payment to the claimant’s bank account between an initial oral judgment  & the final award being made; the oral judgment didn’t specify the sum to be awarded, but the Employment Appeals Tribunal nonetheless concluded that the oral judgment was sufficient for the uplift to be payable on.

The EAT also established that there “must be a conscious acceptance of an interim payment before it can be effective to deprive the receiving party of an uplift to which it will otherwise be entitled on an award”.

If compensation is being paid to a claimant in advance of a tribunal hearing, it should be made absolutely clear what this is intended to cover, and if not sufficient to settle the case in full, that the claimant is willing to accept this if respondents do hope to avoid an uplift on awards (these are currently limited to 25%, per section 207A of the Trade Union and Labour Relations Consolidation Act 1992; the 45% uplift was close to the 50% maximum available under the now repealed section 31(3) of the Employment Act 2002).

Employment Law Clinic would like to acknowledge Daniel Barnett’s newsletter service & the contributors to that for alerting us to this and some of the other articles we report on. Subscription to the newsletter is recommended for anyone active in the field of employment law.

Filed under: Employment Tribunals, General News by Employment Law Clinic           Post created on: January 31st, 2011