Check what compensation you can get for unfair dismissal
If a tribunal decides you’ve been unfairly dismissed, you’ll get compensation. The amount they award you is made up of:
a fixed sum calculated to a set formula - this is called a ‘basic award’
compensation for the money you’ve lost as a result of losing your job - this is called a ‘compensatory award’
The tribunal can’t award you compensation for stress or upset caused by being dismissed - unless you’re also claiming discrimination.
The tribunal also can’t award you compensation for the costs or time involved in making a claim unless they decide your employer has behaved so unreasonably in the tribunal that they’ll award you costs as well as compensation.
Working out your basic award
The amount you can get for your basic award depends on:
how long you’ve worked for your employer when you’re dismissed
how old you are when you’re dismissed
your weekly pay before tax and national insurance are deducted - this is called your ‘gross weekly pay’
There’s a maximum amount for a week's pay. If you were dismissed on or after 6 April 2023, the amount is £643. If your gross weekly pay is more than £643, you can only claim up to £643 a week.
If you were dismissed between 6 April 2022 and 5 April 2023, the amount is £571 a week.
If you’ve worked for your employer for at least 2 years and work regular hours, you can calculate your basic award on GOV.UK - it’s the same as statutory redundancy pay.
If you were made redundant and were paid statutory redundancy pay, you won’t usually get a basic award - unless the tribunal decides redundancy wasn’t the real reason you lost your job.
If you don't work regular hours, talk to an adviser.
You usually won’t get any basic award if you’ve worked for less than 2 years.
You’ll get a set minimum basic award if you’re dismissed for being a health and safety or trade union representative or member.
Your basic award can be reduced - for example if you stole from your employer or put colleagues at risk by breaking health and safety rules.
Working out your compensatory award
You need to work out your weekly or monthly income after tax and national insurance - including any regular overtime and bonuses. If you were paid weekly, you should work out how much you earned each week. If you were paid monthly, work out how much you earned each month.
If you got any other benefits from your employer, you should also work out how much they’re worth. For example, you might have had:
pension contributions from your employer - you can find these on your payslip
free or subsidised accommodation - check how much you’d have to pay to rent somewhere else
use a company car - you can check what the loss of a company car is worth on GOV.UK
company medical insurance - get quotes from private insurers to check what it would cost to get the same cover yourself
The losses you’ve had up to the date you calculated them are called your ‘past losses’. The losses you expect to have until you get a new job are called your ‘future losses’.
If you’ve worked for your employer for 2 years or more, you can also claim an amount to make up for the fact that you'll have to be in a new job for 2 years before you can claim unfair dismissal. This is called ‘compensation for loss of statutory rights’ and is between £350 and £500.
Check how long you can be compensated for
Once you’ve worked out how much you’ve lost each week or month, you need to multiply that by how long you’ll be out of work.
You can’t get more than a year’s gross pay and that can’t be more than £105,707 if you were dismissed on or after 6 April 2023. If you were dismissed between 6 April 2022 and 5 April 2023, it can’t be more than £93,878.
The length of time to use in your calculation will depend on whether you’ve got a new job.
If you’ve already found a new job
If your new job pays about the same as your old one, multiply the figure you worked out for your weekly or monthly losses by the number of weeks or months you were out of work.
If the new job pays less than your old job, you can claim compensation for the difference in pay. You’ll need to estimate how long it would take you to get a job paying what you used to earn.
If your new job is temporary, you can claim compensation for:
the time you were looking for the job
time after you leave the job
The tribunal will decide how long to compensate you for.
If you’re still looking for work
Multiply the figure you worked out for your weekly or monthly losses by the number of weeks or months you think it will take you to find another job.
The tribunal will expect you to show you’ve been making reasonable efforts to get a new job. Keep a list of what you're doing to find work and a copy of all your job applications to show the tribunal.
The tribunal will decide if you're likely to spend a long or short amount of time out of work.
The tribunal is likely to decide you'll be out of work for a short period of time if:
you've had several jobs over the years and have always found another job relatively easily
you've never been out of work for more than a few months
you've got good references
you could find agency work which would pay you a similar wage to your old job
you can drive or have easy access to public transport and can apply for jobs further away from home
For example, taking into account the job market for the work you do and how easily you've found jobs in the past, the tribunal might decide you would be able to find a job in 6 months. Your compensation would be the monthly amount of money you've lost multiplied by 6.
The tribunal is likely to decide you'll be out of work for a longer period of time if you can’t work because of ill health - for example because your dismissal caused depression. They’ll also think it’ll take you longer to find work if:
you're a skilled worker and there aren’t many vacancies for your type of job
you don’t have much work experience - for example, you've only had one employer or you haven't been working long
your employer won't give you a reference
you can only apply for certain jobs because of a disability or caring responsibilities
you don't own a car and there’s no good public transport where you live
If the tribunal thinks it might take you longer to find another job, they’ll award you compensation for a longer period.
Check if your compensation could be increased
An employment tribunal might increase your compensatory award by 10 to 25% if your employer didn't follow the ACAS Code of Practice on disciplinary and grievance procedures - this doesn't apply to redundancy or sickness dismissals.
A tribunal can also award you an extra 2 or 4 weeks’ pay if your employer didn't give you a written statement of your terms and conditions of employment.
Check if your compensation could be reduced
An employment tribunal might reduce your compensatory award if:
you're partly to blame for your dismissal
your employer didn't follow a fair procedure when they dismissed you but could have dismissed you fairly if they’d followed the right procedure
you haven't done enough to find a new job - this is called ‘mitigating your loss’
you couldn't give a good reason for failing to attend any disciplinary or appeal meetings
you’ve been too ill to work since you were dismissed and your health problems weren’t caused by your dismissal
Check if you have to repay any welfare benefits you’ve received
If you got any welfare benefits after you lost your job, the tribunal will deduct this amount from your compensation. Your employer will have to pay that amount back to the government.
Some benefits won’t affect your compensatory award. These include:
- Housing Benefit or payments you've received to help pay your council tax
- welfare benefits which don’t depend on your income - this includes Personal Independence Payment, Disability Living Allowance and Attendance Allowance
- Tax Credits
- welfare benefits you got before your dismissal or after the tribunal hearing
If you reach a settlement with your employer before the tribunal hearing, they won’t be asked to repay any welfare benefits you’ve received. This means they’ll pay less overall than if you win your claim. This might encourage them to settle your claim rather than go to the tribunal.
Showing how you calculated your compensation
You can show how you calculated your compensation in a document called a ‘schedule of loss’. A tribunal will usually ask you to prepare one.
There’s no standard form for a schedule of loss - you can use our example schedule of loss to create your own.