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Interest on Unfair Dismissal Awards

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The Employment Appeal Tribunal (Burton P. presiding) has stated that it is legitimate to award interest (as long as it is not described as that) for unfair dismissal.

The accepted position for many years has been that, unlike in discrimination cases, interest is not recoverable for unfair dismissal.

However, the EAT has now held that when assessing such compensation as is 'just and equitable', since tribunals would give discounts for accelerated receipt at 2.5%, it is equally legitimate to give an increase for decelerated receipt at 2.5%.

Burton P. emphasised this was not, technically, interest - although the effect is much the same.

Although it was not an issue that required deciding, it must be that the 'uplift for decelerated payment' element is still subject to the £56,800 statutory cap (i.e. Claimant's do not get £56,800 plus an uplift).

Melia v Magna Kansei