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Employment remedies: Compensation and recommendations

If an Employment Tribunal finds there has been a breach of the Equality Act, the main remedy it can award is compensation. A tribunal can also make recommendations. There is a separate page on Resolving disputes.



Compensation can include

No statutory maximum

Unlike unfair dismissal, there is no statutory limit on the amount of compensation that can be awarded.

Injury to feelings: the 'Vento bands'

A Court of Appeal case called Vento v Chief Constable of West Yorkshire Police (link to bailii.org) (2002) distinguished three bands of compensation for injury to feelings. These are normally called the 'Vento bands'. The level of those bands in tribunal claims presented before 11th September 2017 is governed by case law. For tribunal claims presented on or after that date, there is 'Presidential guidance'.

Claims presented before 11th September 2017

The Vento banks specified in the Vento case itself were increased for inflation by a case in 2009 (Da'Bell v NSPCC (link to bailii.org)), and the figures given below are as adjusted by Da'Bell. However the bands should be further increased (see below) by 10% (at least in England Wales), and potentially for inflation since 2009.

However these bands are likely to be higher for two reasons:

Claims presented on of after 11th September 2017

Presidential guidance (link to judiciary.gov.uk) on this was issued on 5th September by the Presidents of the Employment Tribunals in England and Wales, and Scotland.

For employment tribunal claims presented on or after 11th September 2017, this guidance sets out revised Vento bands increased for inflation, and also by the 10% uplift. The new bands apply in England and Wales, and also in Scotland subject to the proviso that it is for the Scottish court to decide whether the 10% uplift applies there. The new bands are:

The Presidents say they will review and, if necessary, amend the Presidential Guidance in March 2018 and annually thereafter. Any new Presidential Guidance will come into effect in respect of claims presented on or after 6th April in each year. That and also the Presidents' response to their prior consultation on the new guidance is in their Response to judicial consultation: Employment Tribunal awards for injury to feelings... (link to judiciary.gov.uk).

Tax treatment

A current issue is tax treatment of compensation for injury to feelings. There are conflicting cases: tax decisions saying the claimant may be liable for tax (which would normally meant the employer is ordered to pay more, ie to 'gross up' the compensation so the claimant's net-after-tax position is preserved); and employment decisions saying the payment is not taxable, so there is no grossing up. See for example Tax and injury to feelings (link to littletonchambers.com), February 2016.

Other points

In 2011, the median injury to feelings award (including aggravated damages) in disability discrimination cases was £5,000. Of 45 awards, 3 were below £1000, and 26 were above £5,000. Source: Equal Opportunities Review, August 2012, p227ff.

A clamant can recover for injury to feelings attributable to the act complained of, a dismissal for example, without needing to attribute the injury specifically to knowledge of discrimination (Taylor v XLN Telecom (external link), EAT, 2010).

Loss of earnings

Broadly, the aim is to put the employee (or job applicant) in the financial position he would have been in had there been no discrimination. There is a great deal that could be said about how to calculate compensation for loss of earnings. I shall just pull out a couple of points:

In Michalak v The Mid Yorkshire Hospitals NHS Trust (2011) the Employment Tribunal awarded a record-breaking £4.5 million compensation in a sex and race discrimination claim by a consultant physician. There had been a concerted campaign to get rid of the claimant. Her treatment resulted in a psychiatric illness, and what was likely to be a permanent change in her personality. The tribunal concluded that she would never return to work as a doctor. The major part of the compensation was for loss of earnings and pension.

Compensation for other kinds of loss is also possible but not so common in discrimination cases. In Michalak part of the compensation was for pyschiatric illness suffered as a result of how she was treated, and medical costs.

Indirect discrimination

Tribunals are asked by the Equality Act to consider whether or not other remedies are more appropriate in respect of unintentional indirect discrimination (s.124(4)(5) EqA, Employment Code para 15.44-45). However, indirect discrimination is not that important for disability claims, since there will often be alternative claims for the reasonable adjustment duty and 'discrimination arising from disability'.

Aggravated or exemplary damages

...... - aggravated damages (England and Wales only) which are awarded when the respondent has behaved in a high-handed, malicious, insulting or oppressive manner; and
- punitive or exemplary damages (England and Wales only) which are awarded for oppressive, arbitrary or unconstitutional action by servants of the government or where the respondent's conduct has been calculated tomake a profit greater than the compensation payable to the claimant.
Employment Code para 15.40

A case discussing aggravated damages:

HM Land Registry v McGlue (link to xperthr.co.uk), Employment Appeal Tribunal (EAT), February 2013
The EAT discussed the requirements for an award of aggravated damages, and held that they were not met in this case.

Enforcement: will I actually receive the compensation?

Research published in November 2013 found that over half of claimants do not receive the compensation awarded, and more than a third receive none of it.See: Research has found over half of individuals awarded a pay out following an employment tribunal hearing do not receive their award in full (link to gov.uk),1/11/13.

The situation is made more serious by the introduction of tribunal fees from July 2013. The main fees must initially be paid by claimant. If the claim is succesful, the tribunal can order the employer to repay the fees to the claimant. However, if the employer does not pay out compensation awarded, most likely it will not repay out the tribunal fees either, leaving the claimant even more out of pocket even though he or she has won the claim.

These figures relate to awards made following a tribunal hearing (or by a default judgment). Many cases settle before a hearing. I would expect that where there is a settlement, claimants are much more likely to receive payment.

Fast-track enforcement

ln April 2010, a fast-track scheme came into force in England and Wales to help enforcement where compensation has been awarded but not paid. For how to use the fast-track scheme, including a link to Form EX747 which you need, see Taking your employer to an employment tribunal: If you win your case (link to gov.uk).

That link also has (a bit) more on enforcement generally, including what to do in Scotland.

Financial penalty for employer

Employers may have to pay a financial penalty to the government (not the claimant) if they fail to pay compensation. There is a form you can use to ask to have the employer fined (link to gov.uk).

These financial penalties have been introduced for tribunal judgments and ACAS Conciliated Settlements on or after 6th April 2016. The legislation allows an employer to be served with a warning if it fails to pay the award. If it still fails to pay, it is liable to pay a penalty to the government (s.150 Small Business, Enterprise and Employment Act 2015 (link to legislation.gov.uk)).


Recommendations: Summary

Employment tribunals have power to make recommendations in discrimination cases.

Since October 2015, the recommendation must be to counter the adverse effect on the claimant of any matter to which the proceedings relate. This reverses a change made by the Equality Act 2010, which originally permitted recommendations to benefit other employees. See below Abolition of wider power to make recommendations. In practice, the change means that a recommendation will not normally be made if the claimant has resigned or been dismissed, which is often the case.

Unreasonable failure by the employer to comply with a recommendation as regards the claimant can result in increased compensation.

In more detail

Under EqA s.124 (as amended by s.2 Deregulation Act 2015) a tribunal is allowed to make a recommendation to take certain steps within a specified period "for the purpose of obviating or reducing the adverse effect on the claimant of any matter to which the proceedings relate". Accordingly recommendations can help prevent similar types of discrimination against the claimant occurring in future.

Since the recommendation must now benefit the claimant, one is unlikely to be made if the claimant has left the employment. Subject to that, the non-exhaustive examples given in para 406 of the Equality Act Explanatory Notes (link to legislation.gov.uk) still seem applicable, ie recommendations that the employer:

A tribunal might recommend awareness training in communication disabilities.

Two examples of cases under pre-Equality Act law where - as now - the recommendation had to benefit the claimant:

In Lycee Francais Charles de Gaulle v Delambre (link to bailii.org) (EAT, 2011) where the claimant remained in her post, the employer was recommended to review its employment policies and undertake a programme of equality and diversity training.

Another case recommending awareness training where the employee remained was London Borough of Southwark v Ayton (2003) (link to bailii.org).

Enforcing a recommendation

Failure by the employer to comply with a recommendation to benefit the claimant, without reasonable excuse, can result in increased compensation (EqA s.124(7)).

Guidance in Parliament on recommendations

The Solicitor General gave some clarification on the new power in response to questions in the House of Commons Committee on the Equality Bill. She was asked among other things what length of specified period was envisaged, and what leeway should organisations have to achieve a particular outcome since they may come up with ways of achieving it which are new and different from those envisioned by the tribunal. The Solicitor General said:

"...To answer the specific point about time, it would have to be a reasonable period. There might be more creative ways of doing something that a tribunal recommends. The sensible thing would be for the parties to get together first, discuss it and suggest it to the tribunal, which could then recommend it. If parties thought there were a better way forward, that approach would give the tribunal the opportunity to avoid recommending something that was perhaps less suitable...

[And in respose to whether tribunals tend to mandate outcomes or process:] Some typical recommendations that might help include taking steps to implement a harassment policy more effectively; providing equal opportunities training for staff involved in promotion procedures; and introducing more transparent selection criteria in recruitment transfer or promotion processes. Those seem to be fairly process-based..." (col 512-513, Public Bill Cttee, 25th June 2009 (link to UK Parliament website))

Stammering case

Recommendations made in Wakefield v HM Land Registry, a stammering case, were subsequently revoked by the tribunal because they failed to specify a period within which the employer must take the action. (The tribunal's decision as a whole was also overturned on appeal, for other reasons.) This was under pre-Equality Act rules, but EqA s.124 also says there should be a specified period.

Abolition of wider power to make recommendations

The power to make recommendations which do not benefit the claimant was repealed from 1st October 2015 (s.2 Deregulation Act 2015, with commencement order 2015/994). See Consultation on repeal of two enforcement provisions (link to homeoffice.gov.uk).

From the Government's response to the consultation:

107. Wider recommendations are discretionary on employers. In our view, the types of recommendations made in the tribunal cases so far show that in practice, wider recommendations have tended to be obvious and non-technical - in particular that an employer's human resource practices should be improved or that staff be given equality training.

108. The Government considers that whilst the types of recommendations made highlight wider issues around lack of awareness and knowledge by employers of equality and employment law, the wider recommendations provision is not the right way to address this issue. We think a better approach is through the practical non-legislative measures proposed by the Government in May 2012 as part of the Red Tape Challenge equalities package announcement. We intend to work with businesses, particularly small businesses and their representative organisations to increase understanding of compliance and best-practice in avoiding risk of adverse tribunal decisions; and through very short, straightforward web-based guidance for small businesses on equality law areas known to be particularly difficult for them.

Blog: Why Tribunals Should Retain the Power to Make Wider Action Recommendations (equalitypublishing.co.uk), 2014.

Some examples of wider recommendations made under the Equality Act prior to October 2015, which would presumably not now be allowed:

Crisp v Iceland Frozen Foods Ltd [2012] EqLR 618, Employment Tribunal.
A claimant with depression succeeded in a claim for discrimination and harassment. She had now left the firm. Her claim related partly to a refusal to allow her husband to accompany her at a disciplinary hearing regarding sickness absence, and partly to a conversation which had been overheard between a manager and HR manager making fun of her disability. As well as awarding compensation, the employment tribunal recommended that (1) those in HR providing advice for managers on disciplinary and grievance processes undergo training in disability discrimination specifically relating to mental health, and (2) all managers at the level of the manager involved in this case should undergo training in issues surrounding disability discrimination generally.
Tribunal issues a recommendation against Iceland Frozen Foods (link to didlaw.com), 14/6/12.

Talbot v The Whitbread Group plc, 2011, Employment Tribunal case no.2503169/11
There was held to be a failure to make reasonable adjustments, which was also harassment. The claimant was no longer employed there. However, the the tribunal made recommendations under Equality Act 2010, including that equality awareness training be arranged for managers.


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Last updated: 6th September, 2017