Construction union UCATT, have attacked proposals by Vince Cable, the Business Secretary, to reduce the maximum amount of compensation awarded in an employment tribunal for unfair dismissal as an "act of vengeance against workers".

Steve Murphy, General Secretary of UCATT, said: "These proposals will do nothing to encourage growth or reduce unemployment. They are simply an act of vengeance by the Government against workers making it easier for bad bosses to sack their staff."

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The current maximum award for an unfair dismissal claim is £72,000 but that figure is awarded in fewer than 2% cases. The median award is understood to be between £5,000 and £6,000.

Mr Cable is also introducing a voluntary scheme to encourage the use of settlement agreements, where staff would leave with a good reference, if they waive their right to take an unfair dismissal case.

Mr Murphy, added: "Vince Cable needs a serious reality check. In many industries such as construction, employers frequently ride roughshod over existing employment rights. By weakening the law, employers are being further encouraged to mistreat their workers."

(CD)