Recoupment is not something many practitioners will have to worry about because it is the Employment Judge’s responsibility to inform the DWP of the details of any award that might be subject to the recoupment regulations. However, it could be useful during negotiations with the claimant to let them know how much of their award could be held back, if their claim went to Tribunal, until the value of any recoupable state benefits is known. The maths can be an absolute nightmare though – the prescribed element, ie the award for past loss of earnings which is held back by the employer, could be subject to contributory fault, the hearing date could change meaning that the prescribed element may change, and the prescribed element is reduced proportionally if the statutory cap on the compensation award is applied. Thankfully, the Employment Claims Toolkit handles all of the maths for you, re-calculating automatically if any information changes. It will also separate out concurrent claims for wrongful and unfair dismissal, ensuring that the prescribed element is only applied to the unfair dismissal compensation figure.
The recoupment regulations do not apply to settlements. But what if the parties, at the Tribunal, agree a figure which is ratified by the judge and an order is made for the employer to pay the agreed figure? Are these types of settlements subject to the regulations? The problem is that the agreed figure is rarely separated out into its constituent parts, ie which bit is the compensation before the hearing and which bit is future loss, which makes it difficult to calculate the prescribed element. Any comments on this issue would be gratefully received.