Guidance notes on Compensation
Guidance notes on compensation for no payslips, no contract and unfair dismissal
These guidelines explain how the Tribunal calculates compensation where it finds that an employer has failed to provide written terms of employment or payslips.
Complaints about a failure to provide written terms of employment or payslips must be made to the Tribunal within 8 weeks of the employment ending. The time limit for making the complaint can only be extended where it was not reasonably practical to make the application within the 8-week time limit.
Written Terms of Employment
Article 3(1) of the Employment Law says that an employer must give an employee a written statement of the terms of his or her employment within 4 weeks of beginning employment.
A written statement can be given to an employee by:
- handing it to the employee
- posting it to an address provided by the employee
- emailing it to an email address provided by the employee
- leaving it somewhere easily accessible to the employee and telling the employee where it has been left.
The statement must be provided even if the employment lasts less than 4 weeks (Article 3(7)).
Article 4 of the Employment Law requires an employer to provide written notice of any changes to the terms of employment no later than 4 weeks after the change has happened.
If the Tribunal finds that there has been a breach it can award compensation of an amount not exceeding 4 weeks’ pay.
In determining how much compensation to award the Tribunal may consider the following factors if relevant:
- the reason for the employer’s breach
- where a defective statement is provided the extent of the defect, that is, what information is missing
- how long the employee has been employed without a written statement
- whether the employer has put in place proper procedures for ensuring that the Law is complied with
- the size and administrative resources of the employer
- although there is no obligation on the employee to do so, whether he or she requested a written statement and if so, how long after the request was it provided by the employer
- the impact on the employee of the breach
Where the employer has a reasonable excuse for the breach e.g. ill-health of a key employee and there has been no adverse impact on the employee the compensation is likely to be zero or a small amount.
Where the reason for the breach is not particularly blameworthy e.g. an administrative oversight on the part of the employer, there is no systemic failure and there has been no adverse impact on the employee the compensation is unlikely to exceed a week’s pay.
Compensation of more than one week’s pay may be considered where the reason for the breach is blameworthy, the employer has failed to put in place proper procedures to ensure that the Law is complied with, or the breach has caused difficulties or distress to the employee.
The maximum compensation of four weeks’ pay will only be awarded in the most serious of cases where there is a deliberate disregard for the Law, the employee’s requests for a written statement have been ignored and the employer’s breach has caused difficulties or distress to the employee.
Payslips
Article 51 of the Employment Law says that an employer must give an employee a written itemised pay statement at or before the time at which any payment of wages is made. The Article sets out the information that must be included on the payslip.
A payslip can be given to an employee by:
- handing it to the employee
- post to an address provided by the employee
- email to an email address provided by the employee
- via an online portal/HR system
- leaving it somewhere easily accessible to the employee and telling the employee where it has been left.
Article 53(4) says that any complaints about a failure to provide a payslip or to include the correct information on the payslip must be made to the Tribunal within 8 weeks of employment ending. The time limit for making the complaint can only be extended where it was not reasonably practical to make the application within the 8-week time limit.
If the Tribunal finds that there has been a breach it can award compensation of an amount not exceeding 4 weeks’ pay (Article 54(1A).
In determining how much compensation to award the Tribunal may consider the following factors if relevant:
- the reason for the employer’s breach
- where a defective payslip is provided the extent of the defect, that is, what information is missing or is incorrect
- how many payslips have not been provided or are inaccurate
- whether the employer has put in place proper procedures for ensuring that the Law is complied with
- the size and administrative resources of the employer
- although there is no obligation on the employee to do so, whether he or she requested the payslip and if so, how long after the request was it provided by the employer
- the impact on the employee of the breach
Where the employer has a reasonable excuse for the late provision of the payslip, for example, ill-health of a key employee, the payslip was provided promptly on request and there has been no adverse impact on the employee the compensation is likely to be zero or a small amount.
Where the reason for the failure to provide a payslip is not particularly blameworthy e.g. an administrative oversight on the part of the employer, there is no systemic failure and no adverse impact on the employee compensation is unlikely to exceed a week’s pay.
Compensation of more than one week’s pay may be considered where the reason for the failure to provide a payslip is blameworthy, the employer has failed to put in place proper procedures to ensure that the Law is complied with, or the breach has caused difficulties or distress to the employee.
The maximum compensation of four weeks’ pay will only be awarded in the most serious of cases where there is a deliberate disregard for the Law, the employee’s requests for a payslip have been ignored and the employer’s breach has caused difficulties or distress to the employee.
One week's pay
For guidance on calculating a week’s pay see the Jersey Advisory and Conciliation Service.
Compensation for unfair dismissal
These guidelines explain how the tribunal calculates compensation when it finds that an employee has been unfairly dismissed contrary to article 61 of the Employment (Jersey) Law 2003 (the “Law”).
Time limit
Complaints of unfair dismissal must be made to the tribunal within 8 weeks of the effective date of termination. The time limit for making the complaint can only be extended where it was not reasonably practical to make the application within the 8-week time limit (see article 76 of the Law).
The right to complain of unfair dismissal is subject to a qualifying period of one year’s service ending with the effective date of termination. The one-year service rule does not apply where the dismissal is automatically unfair e.g., the dismissal is discriminatory. For more information on automatic unfair dismissal see the JACS website.
Remedies
The remedies for unfair dismissal are set out below.
- Reinstatement, which is a direction that the employer shall treat the employee in all respects as if the dismissal had not taken place
- Re-engagement, which is a direction that the employer shall re-engagement the employee in comparable or other suitable employment
- Compensation
For more information on reinstatement and re-engagement see the JACS website.
Maximum compensation
The maximum compensation that can be awarded by the tribunal for unfair dismissal is set out in the Employment (Awards) (Jersey) Order 2009. The order provides for the following scale of compensation.
| Duration of service completed in the employer’s service by the employee | Amount of wages to be awarded |
|---|---|
| Not more than 26 weeks | An amount not exceeding 4 weeks’ pay, in the discretion of the Tribunal, having regard to the actual length of service |
| More than 26 weeks but not more than 1 year | 4 weeks’ pay |
| More than 1 year but not more than 2 years |
8 weeks’ pay |
| More than 2 years but not more than 3 years | 12 weeks’ pay |
| More than 3 years but not more than 4 years | 16 weeks’ pay |
| More than 4 years but not more than 5 years | 21 weeks’ pay |
| More than 5 years |
Where there has been a direction for reinstatement or re-engagement and the direction has not been complied with the tribunal can award additional compensation of an amount up to 26 weeks’ pay.
Reduction in compensation
Article 77F of the Law says that the maximum award of compensation can be reduced in the following circumstances.
- The employee unreasonably refused an offer of reinstatement
- The conduct of the employee contributed to his or her dismissal. The tribunal can consider conduct that came to light after notice was given or the dismissal took effect. To satisfy this ground the conduct must be culpable or blameworthy
- The employee has agreed to receive a payment by way of settlement of the complaint
- The employee is entitled to receive a redundancy payment
- The employee has refused an offer made before the start of the proceedings for an amount equal to the maximum award that the tribunal could make
- Any circumstances that the tribunal considers would be just and equitable to take into account
Just and equitable circumstances
Here are some examples of when a just and equitable reduction may be made. It is not an exhaustive list. Whether the tribunal will make a reduction and if so, how much depends on the facts of each case. A reduction can be up to 100% of the award.
- The dismissal is unfair because an unfair process was followed, but had a fair process been followed the employee would still have been dismissed. In such a case the award may be reduced to reflect the time it would have taken to go through a fair dismissal process>
- The tribunal will look at whether the loss has already been compensated for under another claim e.g., discrimination or wrongful dismissal
- Any payments made by the employer to the employee in relation to the dismissal whether contractual or discretionary
Week’s pay
For guidance on calculating a week’s pay please follow the link below to the Jersey Advisory and Conciliation Service website: