An independent check on an employment-related compensation offer is, methodologically, the asymmetric counterpart to the work the offering party has already done. The party offering the figure has typically had it calculated to defend their own position; the receiving party rarely has equivalent analytical support. The methodological question is whether the offered figure represents the actuarially-defensible quantum that an independent expert would calculate on the same facts.
The methodological asymmetry
The party offering compensation in an employment matter — the employer, the employer’s insurer, or the regulated firm in a DISP context — has typically had the figure calculated by an adviser whose engagement is structurally aligned with the offering party’s commercial interest in settling for less. That is not an accusation of bad faith; it is the structural reality of how compensation figures get produced. The figure may be defensible, or it may be lower than the actuarially-defensible quantum; the receiving party has, by default, no way to tell.
The independent check exists to close that asymmetry. The methodological work is the reconstruction of the underlying loss on a basis the offering party would have to defend: the lost earnings to date, the projected future loss, the pension-loss component where present, the appropriate horizon for future loss, and the assumptions implicit in any of these. Where the offer sits within the actuarially-defensible range, the consumer has analytical support for accepting it. Where it sits below, the consumer has the basis to negotiate or to litigate from a methodological position rather than an instinctive one.
Why this is regulated activity
If a consumer is offered compensation under a regulated claim and asks a professional whether the offered figure is reasonable, the professional’s response is itself regulated activity under the Financial Services and Markets Act. This is a function of the FSMA framework, not of the professional’s discretion: advice on the value of a regulated compensation claim must come from an FCA-authorised firm, regardless of the professional’s underlying training or qualification.
Most actuarial firms in the UK are not FCA-authorised. They are recognised as competent to perform actuarial work by the Institute and Faculty of Actuaries, but the FSMA requirement for advising on regulated compensation amounts is separate. The firm holds the necessary authorisation as a Claims Management Company under FCA Firm Reference Number 831289 — the first actuarial firm authorised to provide this regulated activity for employment-related compensation. For consumers, this means the analysis is held to FCA conduct standards (including suitability duties and Consumer Duty obligations) with a regulated complaint route via the Financial Ombudsman.
Pension loss as the methodologically critical component
Pension loss is the part of employment compensation most often handled imprecisely. Where the dismissed employee held a defined-benefit pension entitlement — particularly in legacy private-sector schemes or in public-sector schemes — the loss of that entitlement can represent a substantial proportion of the total compensation, and the methodology for valuing it is genuinely actuarial. Settlement offers prepared without specific pension-loss analysis frequently understate this element materially, sometimes by a margin that determines whether settlement is appropriate at the offered figure.
The conventional shortcut — take the employer contribution rate, multiply by the lost-employment period, present that as pension loss — works as a first-order approximation for low-value DC claims with stable employment patterns. For DB claims, mixed-scheme arrangements, or any claim where the loss period is long enough that the compounding of pension entitlement matters materially, the approximation systematically understates the actuarially-defensible quantum.
Where pension loss is in scope, the firm’s analysis values the lost entitlement on the same Fair Value Framework methodology applied across the firm’s broader pension valuation work. Methodology consistency matters: a pension-loss figure produced in an employment-tribunal context that uses the same methodology applied in matrimonial and litigation contexts is more easily defended than one produced on a stylised lookup-table basis specific to the employment context.
What the engagement produces
A typical engagement starts with the consumer providing the offer letter, the underlying employment particulars (contract, salary, length of service, scheme membership), and a brief account of the circumstances of the claim. The firm reviews the offered figure against an actuarial reconstruction of the underlying loss.
The output is a written analysis setting out the offered figure, an actuarially-defensible range for the same compensation, and a clear position on whether the offer falls within that range. Where the offer is clearly fair, the firm says so. Where the offer is below the defensible range, the firm sets out by how much and explains why. The methodological reasoning is documented in language that survives later challenge — whether the matter proceeds to tribunal, is renegotiated, or is settled at the original figure.
The output is the consumer’s to use as they choose: as input to a decision on whether to accept; as a basis for further negotiation through their own legal representation; or as expert support if the matter proceeds to tribunal. The deliverable is fixed-fee, scoped per claim review.
Adjacent regulated-compensation contexts
The same FCA authorisation that supports employment-related compensation reviews also covers the firm’s broader work on regulated compensation matters — mis-selling of financial products, below-par investment performance, compensation under DISP rules, and other contexts where the question is whether an offered figure represents actuarially-defensible quantum. The framework is consistent: independent actuarial review of the offered figure, with a defensible position on whether it sits within the actuarially-supported range. Future contexts the firm anticipates working in include compensation under the motor-finance commission disclosure cases.
Last updated May 2026.