Higher penalties for employers breaching workers' rights
![]() |
Government proposals under the ‘Good Work Plan’ would see increased financial penalties for employers found to be in breach of their employees' rights.
Where an employment tribunal finds that an employer has breached the claimant's employment rights, the tribunal can order the employer to pay a financial penalty if it is of the view that the breach has aggravating features. A tribunal will consider the employer’s ability to pay before making an award, which will impact more on larger employers considered to have deeper pockets.
The legislation does not define what “aggravating features” are. However, explanatory notes to the Enterprise and Regulatory Reform Act 2013 suggest that an Employment Tribunal is more likely to find aggravating features where the employer’s action was deliberate or committed with malice, or where it has repeatedly breached the employment right concerned. Larger organisations with a dedicated human resources (HR) team are more likely to be penalised than smaller ones with little or no HR support. Employers should not normally be penalised for unintended or accidental shortcomings.
Having said that, very little guidance is available, and it is regrettable that businesses will only be able to fully assess the risk being ordered to pay a penalty once cases are reported.
The penalty will usually be 50% of the award made to the claimant (e.g if the award made to the claimant is £1,000, the penalty will normally be £500), subject to a minimum of £100 and a maximum of £20,000. The maximum limit on these penalties was increased on April 6, 2019, from £5,000 to £20,000. Employers will qualify for a 50% reduction if they pay the penalty no later than 21 days after the notice of the decision to impose the penalty is sent to them (following the example above, the penalty will be reduced to £250 from £500 if paid within 21 days).
The money raised from imposing penalties (still following the examples above either a full penalty of £500 or a reduced one of £250) will be payable to the Exchequer, and not the claimant. The penalty will be in addition to any compensation awarded to the claimant (£1000 following the example above).
All employers should ensure that they comply with employment law and act fairly when implementing workplace practices and policies to avoid tribunal claims and the financial penalties that may come with them.
For more information about the implications of these changes and any other employment law issue, readers may contact ECA's Employee Relations Department.
[edit] About this article
This article was written by Orazio Amantia, ECA Senior Employee Relations Advisor. It was previously published in July 2019 on the website of the Electrical Contractors' Association (ECA) and can be accessed here.
Other articles by the ECA on Designing Buildings Wiki can be accessed here.
[edit] Related articles on Designing Buildings Wiki
- Adjudication.
- Adversarial behaviour in the UK construction industry.
- Alternative dispute resolution legislation.
- Arbitration.
- Causes of construction disputes.
- Conciliation.
- Conflict avoidance.
- Construction Industry Model Arbitration Rules CIMAR.
- Dispute resolution.
- Dispute resolution boards.
- Dispute resolution procedure.
- Expert determination.
- Expert evaluation.
- Expert witness.
- Third party opinion and fixed-fee mediation procedures.
- Litigation.
- Pay now argue later.
- Pendulum arbitration.
- Mediation.
- Med-adjudication.
- Med-arbitration.
- The role of the mediator.
- Scheme for Construction Contracts.
- --ECA
Featured articles and news
Grenfell Tower fire – eight years on
A time to pause and reflect as Dubai tower block fire reported just before anniversary.
Airtightness Topic Guide BSRIA TG 27/2025
Explaining the basics of airtightness, what it is, why it's important, when it's required and how it's carried out.
Construction contract awards hit lowest point of 2025
Plummeting for second consecutive month, intensifying concerns for housing and infrastructure goals.
Understanding Mental Health in the Built Environment 2025
Examining the state of mental health in construction, shedding light on levels of stress, anxiety and depression.
The benefits of engaging with insulation manufacturers
When considering ground floor constructions.
Lighting Industry endorses Blueprint for Electrification
The Lighting Industry Association fully supports the ECA Blueprint as a timely, urgent call to action.
BSRIA Sentinel Clerk of Works Training Case Study
Strengthening expertise to enhance service delivery with integrated cutting-edge industry knowledge.
Impact report from the Supply Chain Sustainability School
Free sustainability skills, training and support delivered to thousands of UK companies to help cut carbon.
The Building Safety Forum at the Installershow 2025
With speakers confirmed for 24 June as part of Building Safety Week.
The UK’s largest air pollution campaign.
Future Homes Standard, now includes solar, but what else?
Will the new standard, due to in the Autumn, go far enough in terms of performance ?
BSRIA Briefing: Cleaner Air, Better tomorrow
A look back at issues relating to inside and outside air quality, discussed during the BSRIA briefing in 2023.
Restoring Abbotsford's hothouse
Bringing the writer Walter Scott's garden to life.
Reflections on the spending review with CIAT.
Retired firefighter cycles world to raise Grenfell funds
Leaving on 14 June 2025 Stephen will raise money for youth and schools through the Grenfell Foundation.
Key points for construction at a glance with industry reactions.
Functionality, visibility and sustainability
The simpler approach to specification.