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Employment Protection Act

Volume 31: debated on Friday 12 November 1982

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asked the Secretary of State for Employment what adjustments would be needed to each of the limits listed in the Employment Protection (Variation of Limits) Order 1981 to restore them to their values at the time of introduction.

I have assumed that, as there was no 1981 order, the question refers to the 1982 order. The weekly earnings limit for redundancy payments was fixed at £40 in 1965. An increase to approximately £217 would be necessary to keep in line with increases in the retail price index to September 1982. The earnings limits for the insolvency provisions and for basic awards under the unfair dismissal provisions of the Employment Protection (Consolidation) Act 1978 have, since their introduction, been the same as that applied to redundancy payments.The limit for guarantee pay was fixed initially at £6 per day in February 1977. Based on the RPI increase to September 1982 a current figure of approximately £11 would have the same value.

asked the Secretary of State for Employment what have been the percentage increases in each of the limits listed in the Employment Protection (Variation of Limits) Order 1981 for each year since their introduction; and how this compares in each of those years with the increase year-on-year at the time the order was made in retail prices, average earnings, and, where relevant, the tax and prices index.

I have assumed that, as there was no 1981 order, the question refers to the 1982 order.Under the Redundancy Payments Act 1965, the maximum amount of a week's pay that could be used for calculating redundancy payments was £40. This sum was increased to £80 in 1974. Under the Employment Protection Act 1975 an £80 limit on a week's pay was adopted from April 1976 for amounts payable under the insolvency provisions and from June 1976 for the basic and additional awards of compensation for unfair dismissal. The guarantee pay provisions of the Act were brought into operation in February 1977 at the rate of £6 per day.These limits remained unchanged until the first annual review under the Act took place in autumn 1977 which varied the limits with effect from February 1978. Each year since then orders have been laid in November or December after the annual review varying the limits with effect from the following February.The following table shows the year on year percentage increases in the limits (February to February from 1977) compared with the increases in retail prices, average earnings and the tax and prices index for the year to the September preceding the laying date.

Percentage increase year on year
Limit on a week's pay per cent.Guarantee pay per cent.
February to February
1977–782510
1978–79109·8
1979–809·110·3
1980–818·39·4
1981–823·84·6
1982–83Under reviewUnder review
Percentage increase year on year
Retail prices per cent.Average earnings per cent.Tax and prices per cent.
September to September
1976–7715·67·714·2
1977–787·815·11·9
1978–7916·514·514·1
1979–8015·926·017·3
1980–8111·49·314·9
1981–827·3*7·87·9

* August to August.