Business secretary Vince Cable says the changes will ‘debunk the myth’ that employment is geared toward the employee over the interests of the employer.
According to the Department of Business, tribunal claims rose to 236,000 last year – a record figure and a rise of 56 per cent on 2009 – and a business has to spend almost £4,000 on average to defend itself against a claim.
The maximum amount that an Employment Tribunal can award in compensation for unfair dismissal has fallen for what is believed to be the first time.
The maximum award falls from £66,200 to £65,300 to reflect a fall of 1.4% in the retail price index (RPI) from September 2008 to September 2009. The compensation caps are linked to the RPI.
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