What an Employment Tribunal Could Cost You From April 6 — The Numbers Have Just Changed

In five days, the financial exposure from an employment tribunal claim becomes materially larger for every UK employer. And in January 2027, a change arrives that removes the cap on unfair dismissal compensation entirely.

This isn't a future risk to file away. The April 6 changes are confirmed in SI 2026/310 (Employment Rights (Increase of Limits) Order 2026), published earlier this month. If an employee files a claim after April 6, these are the numbers that will apply.

This guide explains the new figures, what they mean in practice, and what you can do before enforcement begins.

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The New Numbers: What Changes on April 6

Unfair Dismissal

Limit	Before April 6	From April 6
Maximum compensatory award	£115,115	£123,543
Maximum "week's pay" for basic award	£700	£751
Maximum basic award	£21,000	£22,530

For a long-serving employee on a good salary, a successful unfair dismissal claim could now generate a tribunal award of over £120,000 — before any legal costs on either side.

Discrimination and Harassment (Vento Bands)

Discrimination and harassment claims don't have a statutory cap on the compensatory element. Injury to feelings is assessed using the Vento bands — updated annually.

From April 6 2026:

Vento Band	Previous Range	New Range
Lower band (minor cases)	£1,100 – £11,200	£1,200 – £11,700
Middle band (most cases)	£11,200 – £33,700	£11,700 – £35,200
Upper band (serious/sustained)	£33,700 – £56,200	£35,200 – £62,900+
Exceptional cases	Up to £56,200+	Up to £62,900+

Upper-band cases — sustained harassment, discrimination over months or years, cases involving serious personal impact — can now attract injury to feelings alone of over £60,000, before you add lost earnings, future loss, and legal costs.

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The Bigger Change: January 2027

April 6 is significant. But January 2027 is transformational.

From 6 January 2027 (subject to commencement order):

• The unfair dismissal compensatory award cap is removed entirely. There will be no ceiling on what a tribunal can award.
• The qualifying period drops from 2 years to 6 months. Employees currently need 2 years of service to claim unfair dismissal. From January 2027, anyone employed for 6 months or more has the right.

Together, these two changes create an entirely new risk profile for UK employers.

A tribunal awarding full loss of earnings for a long-serving manager dismissed unfairly — currently capped at £123,543 — could award ten times that amount from January 2027.

And the pool of eligible claimants expands dramatically. Staff you dismissed at month 18 (outside the current 2-year window) would have a claim from next January.

ComplianceAlert monitors employment law changes and alerts you before they take effect — so you're never caught out by a statutory deadline you didn't know was coming. Start your 7-day free trial →

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The April 6 Change Most Employers Are Missing

Beyond the compensation figures, April 6 introduces a change with immediate practical implications: sexual harassment becomes a protected whistleblowing disclosure.

Under the Employment Rights Act 2025, a worker who reports sexual harassment — to an employer, regulator, or externally — is now a protected discloser. Retaliating against them (dismissal, demotion, exclusion, negative reference) is not just a harassment claim — it becomes an automatic unfair dismissal with no qualifying period and, from January 2027, no compensation cap.

This changes how complaints must be handled. If a worker raises a sexual harassment concern and you dismiss them within 6 months — for any reason — you face the burden of proving the dismissal was entirely unrelated to the disclosure.

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What a Tribunal Claim Actually Costs Employers

The tribunal award is only part of the exposure. A contested employment tribunal claim typically costs an employer:

Cost Component	Typical Range
Legal fees (defence through to final hearing)	£15,000 – £60,000+
Management time (disclosure, witness statements, attendance)	£5,000 – £20,000 equivalent
Tribunal award (if lost)	£10,000 – £123,543+
Reputational impact	Difficult to quantify
Total exposure (defended and lost)	£30,000 – £200,000+

Many employers settle before hearing to avoid legal costs — typically £5,000–£25,000 — regardless of whether the claim has merit. This is why employment tribunal risk is a material financial exposure for any business with staff, not just a HR problem.

From April 6, that exposure increases. From January 2027, it increases again — significantly.

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Is Your Harassment Policy Tribunal-Ready?

Three specific areas drive the majority of UK discrimination and harassment claims:

1. Written harassment policy

Since October 2024, the Worker Protection (Amendment of Equality Act 2010) Act 2023 requires employers to take reasonable steps to prevent sexual harassment — not just respond to it. A written policy is the baseline "reasonable step". Without one, you face:

• An uplift of up to 25% on any harassment tribunal award
• No defence of preventive action if a claim is made

2. Regular training records

"Reasonable steps" also includes documented training. If you can't prove your staff received harassment training, you can't rely on the preventive duty defence.

3. Clear reporting channels

Workers must know how to raise a complaint. If there's ambiguity about who to report to — or if reporting channels route through the alleged harasser — your liability increases.

From April 6, with sexual harassment now also a whistleblowing disclosure, the stakes for getting this wrong are materially higher.

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What to Do Before April 6

You have five days. Use them:

1. Review your harassment policy If it's more than 12 months old, it needs updating to reflect the Worker Protection Act requirements and the new whistleblowing classification of sexual harassment. If you don't have one, create one this week.

2. Check your dismissal process documentation Every dismissal should be documented with a clear business reason, a fair process (investigation, hearing, appeal), and evidence that the process was followed. Rushed or undocumented dismissals are the most common source of tribunal claims.

3. Brief your managers Managers need to understand that dismissing or penalising someone who has raised a harassment complaint — even if unrelated — now carries serious legal risk. This is a briefing worth doing before April 6.

4. Review your contracts for January 2027 Employees approaching 6 months of service will gain unfair dismissal rights from January. If you have staff in probationary periods, their status changes from next year. Review your probationary procedures now.

5. Take the free compliance score quiz ComplianceAlert's 20-question compliance quiz covers employment law, health & safety, data protection, and HR policies — with instant results and specific recommendations. It's the fastest way to find your gaps before they become claims.

Take the free quiz → compliancealert.co.uk/compliance-score

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TL;DR

• April 6: Unfair dismissal cap rises to £123,543. Vento bands (discrimination/harassment injury to feelings) rise to £62,900+. Sexual harassment becomes a protected whistleblowing disclosure.
• January 2027: Unfair dismissal cap removed entirely. Qualifying period drops from 2 years to 6 months.
• Every UK employer with staff is affected. The financial exposure from a tribunal claim is now larger than ever.
• Review your harassment policy, dismissal documentation, and manager briefings before April 6.

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Not sure if your HR policies are tribunal-ready? Take ComplianceAlert's free Compliance Score quiz — 20 questions, instant results, no sign-up required.

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