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Change in Compensation Awarded Under the ERA 2012 in 2020

In the early days of the ERA persons who were dismissed were compensated for loss of wages. That meant for instance that if an employee was unfairly dismissed on 30 June 2019 and the decision was given by the ERT on 20 November 2023, that employee was compensated for the loss of wages between 30 June 2019 to 20 November 2023. Chefette found themselves in this position and took the matter finally to the CCJ. 

On May 7, 2020, the Caribbean Court of Justice (CCJ) delivered a remote ruling, serving as the final court of appeal for Barbados and several Caribbean Community (CARICOM) member states. The ruling redefined the compensation scheme established in the Employment Rights Act 2012 (ERA), overturning "loss of wages" awards in all future Unfair Dismissal claims heard before the Employment Rights Tribunal (ERT) in Barbados.

The decision sets a legal precedent in employment law for Barbados and the wider Caribbean, particularly impacting cases related to compensation. Originating from an appeal by Chefette Restaurants Limited, the largest fast food chain in Barbados, the ruling will now govern decisions on compensation, eliminating the possibility of what was considered double compensation by the ERT.

In its inaugural appeal concerning the ERA to the Caribbean Court of Justice (CCJ), the court addressed ten crucial arguments related to employment law. One key outcome was a clarification of the legal obligations of employers under the ERA regarding employee dismissal proceedings.

The significance of the decision lies in its impact on labor law in Barbados, as it curtails the Tribunal's ability to make awards labeled as 'strikingly large.' The CCJ ruled that the Employment Rights Act does not empower the Tribunal to award 'lost wages,' preventing inflated compensation awards. 

The decision resulted in a substantial 62% reduction in the award in the specific case, highlighting the potential burden of the Tribunal's actions on employers. Furthermore, the Court provided clarity on Tribunal procedures, addressing the order of presenting evidence and the ability to cross-examine parties, rectifying errors made by the Tribunal. The appeal was deemed necessary, and the outcome is anticipated to be favorably received by employers.

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