Accelerated receipt in wrongful dismissal claims
Accelerated receipt in wrongful dismissal claims

The following Employment practice note provides comprehensive and up to date legal information covering:

  • Accelerated receipt in wrongful dismissal claims
  • Discount for accelerated receipt

Claimants who bring successful wrongful dismissal claims, which result in an award of compensation, may receive payment in respect of certain sums either before or after the date on which they would have received those sums had they remained employed.

Where a sum is received before the date on which it would have been received if the individual had remained employed, a discount for accelerated receipt may be appropriate, which is discussed below. Where a sum is received after that date, the claimant will be entitled to interest (see Practice Note: Interest in wrongful dismissal claims).

Discount for accelerated receipt

Accelerated receipt is the counterpart to interest. Interest compensates a party who did not receive money when it was due, because late payment deprived that party of the opportunity to invest it and earn interest on it.

Accelerated receipt involves discounting a compensation payment where money is received earlier than it would have been in the normal course (eg had it been received as ordinary monthly or weekly instalments of salary).

For example:

  1. consider a monthly-paid employee on a two-year fixed-term contract, who is wrongfully dismissed one year after employment commences

  2. even if the employer accepts its liability to pay compensation, and agrees that no deduction should be made for mitigation, it would still not be appropriate to pay a whole year's worth of compensation in a lump sum,

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