Employment Protection Act 1975

74 Calculation of basic award

(1) The amount of the basic award shall be the amount calculated in accordance with subsections (3) to (7) and sections 75(1) to (6) below, subject to the following provisions of this Act, namely—

(a) subsection (2) below (which provides for an award of two weeks' pay in certain cases);

(b) section 75(7) below (which provides for the amount of the award to be reduced where the employee contributed to the dismissal);

(c) section 75(8) below (which provides for the amount of the award to be reduced where the employee received a payment in respect of redundancy); and

(d) section 77 below (which prohibits double compensation where compensation in respect of the same matter is also awarded under the [1975 c. 65.] Sex Discrimination Act 1975).

(2) In the following cases the amount of the basic award shall be two weeks' pay:—

(a) where the tribunal finds that the reason or principal reason for the dismissal of the employee was that he was redundant and the employee—

(i) by virtue of section 2(5) or (6) of the [1965 c. 62.] Redundancy Payments Act 1965 (unreasonable refusal or relinquishment of suitable alternative employment) is not, or if he were otherwise entitled would not be, entitled to a redundancy payment; or

(ii) by virtue of the operation of section 3(3) of that Act (renewal of employment or re-engagement) is not treated as dismissed for the purposes of Part I of that Act;

(b) where the amount calculated in accordance with subsections (3) to (7) and section 75(1) to (7) below is less than the amount of two weeks' pay.

(3) The amount of the basic award shall be calculated by reference to the period, ending with the effective date of termination, during which the employee has been continuously employed, by starting at the end of that period and reckoning backwards the numbers of years of employment falling within that period, and allowing—

(a) one and a half weeks' pay for each such year of employment which consists wholly of weeks in which the employee was not below the age of 41 ;

(b) one week's pay for each such year of employment which consists wholly of weeks in which the employee was below the age of 41 and was not below the age of 22 ; and

(c) half a week's pay for each such year of employment which consists wholly of weeks in which the employee was below the age of 22 and was not below the age of 18.

(4) In ascertaining for the purpose of subsection (3) above the period for which an employee has been continuously employed, where the effective date of termination falls to be determined in accordance with paragraph 5(6) of Schedule 1 to the 1974 Act, a period falling within such an interval as is referred to in paragraph 30(1 A) of that Schedule (period of continuous employment) shall count as a period of employment notwithstanding that it does not count under Schedule 1 to the [1972 c. 53.] Contracts of Employment Act 1972 (computation of period of employment).

(5) Where in reckoning the number of years of employment in accordance with subsection (3) above 20 years of employment have been reckoned no account shall be taken of any year of employment earlier than those 20 years.

(6) Where in the case of an employee the effective date of termination is after the specified anniversary the amount of the basic award calculated in accordance with subsections (3) to (5) above shall be reduced by the appropriate fraction.

(7) In subsection (6) above " the specified anniversary" in relation to a man means the 64th anniversary of the day of his birth, and in relation to a woman means the 59th anniversary of the day of her birth, and " the appropriate fraction " means the fraction of which—

(a) the numerator is the number of whole months reckoned from the specified anniversary in the period beginning with that anniversary and ending with the effective date of termination; and

(b) the denominator is 12.