The UK government recently released guidance clarifying that from January 1, 2027, employment tribunals will no longer be subject to a statutory cap when reaching judgments on unfair dismissal compensation claims. The rationale behind the change is revealed in the government’s January 2026 “Factsheet: Unfair Dismissal,” which states that lifting the cap “will deter employers from treating the cost of dismissing employees unfairly as part of business as usual.”
