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Employer pension contributions count towards a week's pay under the ERA 1996

The EAT has upheld an employment tribunal's decision that the calculation of a week's pay under the Employment Rights Act 1996 should include employer pension contributions. This departs from long-established practice and increases the value of a week's pay.

The reported case concerned the calculation of the statutory cap for the unfair dismissal compensatory award. The EAT's decision increases the potential value of the cap (subject to the current overall cap of £80,541). However, it will also apply to the calculation of remedies such as compensation under TUPE, and the protective award under TULRCA, for failure to inform or consult.

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