Compensation in unfair dismissal cases is based on financial losses, but where the dismissal is also discriminatory, it is possible to claim damages for non-financial loss – for example injury to feelings where the behaviour of the employer has caused distress, humiliation or anxiety to the claimant.
Awards made by an Employment Tribunal (ET) for injury to feelings in discrimination cases are compensatory. They are not intended to punish the employer.
In 2002, the Court of Appeal issued guidance (in Vento v Chief Constable of West Yorkshire Police) for use when assessing the compensation payable for injury to feelings in such cases. This identified three bands, depending on the seriousness of the case. Since then, the amounts have been updated periodically.
Earlier this year, the Presidents of the Employment Tribunal issued a consultation document on how the three bands should be updated in future. This was deemed necessary in order to take account of inflation and the Court of Appeal's decision in De Souza v Vinci Construction (UK) Limited that the 10 per cent uplift in general damages recommended in the Jackson Review on Civil Litigation Costs and implemented by the Court of Appeal in Simmons v Castle also applied to general damages awarded by an ET in discrimination claims.
The consultation resulted in revised Presidential Guidance that applies to ET claims presented on or after 11 September 2017.
The Presidents consider that, for the time being, the Retail Prices Index (RPI) is the appropriate measure of the rate of inflation to be applied. However, the Guidance will be reviewed in March 2018, and annually thereafter, without the need for further consultation.
Applying the formula adopted by the Presidents for the purpose, the new bands for awards for injury to feelings are as follows:
- Lower band – between £800 and £8,400. Awards in this range are appropriate where the act of discrimination is an isolated or one-off occurrence;
- Middle band – between £8,400 and £25,200. Awards in this range are made in serious cases but where an award in the top band is not merited; and
- Top band – between £25,200 and £42,000. Awards in this range are made in the most serious cases, such as where there has been a lengthy campaign of discriminatory harassment. Only in exceptional circumstances will a compensation award for injury to feelings exceed the upper limit.