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28 September 2017 / Charles Pigott
Issue: 7763 / Categories: Features
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All in a week’s pay?

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Should a week’s pay be calculated to include employer’s pension contributions, asks Charles Pigott

  • The EAT has ruled that the statutory definition of a week’s pay extends to employer’s pension contributions.
  • This decision challenges a long-held orthodoxy that only gross pay should be taken into account when making the required calculations.

In Drossou v University of Sunderland UKEAT/0341/16/130 Mrs Justice Slade has surprised many in the legal community by holding that a week’s pay can include employer’s pension contributions. In this case the calculation of a week’s pay was required to determine the upper limit on the compensatory award for unfair dismissal, but her reasoning is capable of applying to all jurisdictions which use a week’s pay in order to compute employment tribunal awards.

Some industrial relations history

It seems that old orthodoxy about the calculation of a week’s pay can be traced back to a 1993 decision of the Court of Appeal in Port of London Authority v Payne [1994] IRLR 9. The underlying dispute concerned the redundancy of 17 dock workers whom the industrial tribunal found had been dismissed because

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MOVERS & SHAKERS

Hogan Lovells—Lisa Quelch

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Corporate governance and company law specialist joins the team

NEWS

NOTICE UNDER THE TRUSTEE ACT 1925

HERBERT SMITH STAFF PENSION SCHEME (THE “SCHEME”)

NOTICE TO CREDITORS AND BENEFICIARIES UNDER SECTION 27 OF THE TRUSTEE ACT 1925
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