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Add 10 per cent to discrimination compensation awards?

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From April 2013, as a result of the Court of Appeal case Simmons v. Castle, there was a 10 per cent increase in general damages for non-monetary losses. This was the Court of Appeal’s implementation of one of the Jackson reforms, namely the recommendation from Lord Justice Jackson that there should be such an uplift in order to help claimants meet the additional costs and risks as a result of his other recommendation to abolish recoverability of conditional fee agreement success fees and after-the-event insurance premiums.

Up until De Souza v. Vinci Construction (UK) Ltd it was not clear whether such an uplift should apply to employment tribunal cases, given that the rationale for the uplift does not apply in the Employment Tribunal. However, employers should take note that the Court of Appeal yesterday decided in De Souza that such an uplift should indeed apply in the Employment Tribunal. The Court noted that s124(6) of the Equality Act 2010 requires that compensation awarded in the County Court and the Tribunals should be consistent. Therefore, compensation for employment discrimination should be the same as that which could be awarded for a non-employment discrimination claim (e.g. discrimination in an educational context) in the County Court.

The Court of Appeal provided some guidance in De Souza as to how the uplift should be applied. Unfortunately it does not appear that it is always as simple as adding 10 per cent. Notably the court stated that in relation to psychiatric injury, the current Judicial College Guidelines already incorporate the 10 per cent uplift, so there would be no change in this regard. However, in relation to injury to feelings the position is more complicated. The Vento bands of compensation for injury to feelings could have a 10 per cent uplift applied to them. However, we will not have any certainty until new bands are published (the Court of Appeal suggested that the President of the Employment Appeal Tribunal publish guidance setting out new bands for clarity, given that the bands were recently updated to reflect inflationary changes).