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Unfair dismissal payouts capped

Workers will face a cut in how much compensation they can win for unfair dismissal at employment tribunals. The Business Secretary Vince Cable is set to also announce he's dropping plans to make it easier to fire under-performing staff.

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The Government's new employment law proposals explained

  • Business bosses are to be given stronger legal protections to fire under-performing staff.
  • Settlement agreements - where employers can offer under-performing employees a pay off - could become more widely used to resolve disputes.
  • If a worker accepts a deal it will become legally protected so it cannot be used later as evidence in any court case or tribunal.
  • Plans for the proposals to change the limit on unfair dismissal payouts to a maximum of 12 months' salary or set it at an even lower figure.
  • The Business Secretary wants to reduce the current £72,300 pay-off cap.

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