MOrsel: Jersey Employment Forum recommends increases to compensation awards

In a significant move for Jersey's employment and discrimination law framework, the Employment Forum (a non-political consultative body reporting to the Social Security Minister) has concluded its review of compensation awards and recommended increases in the existing regime.

The Forum's review follows an extended public consultation that concluded on 31 January 2024. The report is available here. Key recommendations include:

• Raising the limit on awards in employment-related discrimination cases from £10,000 to a cap of either £50,000 or 52 weeks' pay, whichever is greater, including up to £30,000 for hurt and distress (rather than £5,000 as currently).
• The retention of the existing sliding scale mechanism for unfair dismissal awards, but with extended compensation levels for employees with more than 10 years' and 15 years' service to 31 weeks' pay and 36 weeks' pay, respectively (the current maximum is up to 26 weeks' pay for employees with five years' service or more).
• Giving the Jersey Employment and Discrimination Tribunal a discretionary power in unfair dismissal cases to apply an uplift of up to 25% of the maximum award in circumstances where the employer's conduct has been found particularly egregious.
• Matching the jurisdictional limit on breach of contract claims before the Tribunal to the jurisdiction of the Petty Debts Court, so that such the Tribunal may hear claims worth up to £30,000 (unlike the current limit of £10,000).
• Increasing the maximum award for breaches of statutory rights (such as rights relating to flexible working or parental and adoption leave, or entitlements to receive payslips and written terms and conditions) to eight weeks' pay (up from the current four week maximum).

Further recommendations include giving the Tribunal a discretionary power to anonymise judgments where appropriate, and to introduce a limited power for the Tribunal to award costs against a party to deter vexatious claims and conduct on either side to a dispute.

Notably, the Forum favoured the introduction of a costs power over the introduction of fees for lodging Tribunal claims, agreeing with respondents to the public consultation that the latter would represent an "active barrier to justice" for litigants pursuing low value claims.

A final recommendation is that the prescribed timeframe for an employer to respond to a new Tribunal claim should be increased to 28 days. The Forum commented that the current limit of 21 days is an unreasonably short period in which to receive and respond to the claim.

These recommendations will now be considered by the Social Security Minister. Representing the most comprehensive review since the existing limits on compensation awards came into force, the recommendations (if adopted) would materially refresh the existing regime.

Whether or not they are adopted, amended or rejected by Government, the recommendations suggest that in its present form, Jersey's compensation awards framework may struggle to adequately balance the social policy drivers underpinning the legislation. 

We will provide further updates on any developments in this area, but if you would like to discuss these issues, please reach out to the Employment team or your usual Mourant contacts.