How much compensation can I claim for unfair dismissal?

The two awards

If you win an unfair dismissal claim, the tribunal gives you two awards (not one):

1. Basic award

Calculated exactly like statutory redundancy pay:

• 1.5 weeks' pay for each year aged 41+
• 1 week's pay for each year aged 22–40
• 0.5 weeks' pay for each year aged under 22

Capped at 20 years of service and at the statutory maximum week's pay (£700 from April 2024). So the maximum basic award is currently around £21,000.

2. Compensatory award

Compensation for actual financial loss caused by the dismissal — mainly lost net earnings, but also lost benefits, pension contributions, and job-search costs. Capped at the lower of:

• 52 weeks' actual pay, or
• A statutory maximum (£115,115 from April 2024)

There is no cap for automatically unfair dismissals (whistleblowing, asserting a statutory right, etc.) or for discrimination claims.

The deductions that shrink your award

Tribunals can reduce your compensatory award (sometimes substantially) for:

Polkey deduction

A percentage reflecting the chance you would have been dismissed anyway with a fair procedure. Common in:

• Redundancy cases where the redundancy itself was genuine
• Misconduct cases where some lesser sanction might have applied
• Capability cases where the underlying issue would still have led to dismissal

A 50% Polkey is not unusual; in clear cases it can be 80–90%.

Contributory conduct

If your own conduct contributed to the dismissal, the tribunal can reduce the award (sometimes by 100%). This is separate from Polkey — it's about your blame, not the procedural outcome.

Failure to mitigate

You must take reasonable steps to find replacement work. Refusing reasonable offers, not applying for jobs, or being deliberately under-employed can reduce your loss-of-earnings claim.

How injury to feelings is different (and bigger)

Unfair dismissal does not include injury to feelings — that's a discrimination-only head of loss. If your dismissal is also discriminatory (e.g. because of disability, pregnancy, race) you can claim both:

• Unfair dismissal compensation, AND
• Discrimination compensation including injury to feelings under the Vento bands (currently up to about £58,700)

Worked example

A 45-year-old with 10 years' service earning £700/week (above the cap, so reduced to £700/week for the basic award):

• Basic award: 10 × 1.5 × £700 = £10,500
• Lost earnings over 6 months: about £18,200
• Total before deductions: £28,700

Apply a 25% contributory conduct deduction: ~£23,150. Apply a further 30% Polkey: ~£17,710.

The "headline" win of £28,700 becomes a real-world award closer to £17,000.

Reinstatement and re-engagement

Tribunals technically can order reinstatement (your old job back) or re-engagement (a different role with the same employer). In practice this is ordered in fewer than 1% of cases — the working relationship has usually broken down.

See real cases

• Dismissed during long-term sick leave — £18,450 award
• Dismissed over a private Facebook post — £9,870 after deductions
• Redundancy without consultation — £14,200

Disclaimer

This is general legal information, not legal advice. Awards depend heavily on your specific facts — speak to ACAS or a qualified employment adviser before acting.