How much compensation can I get for unfair dismissal?

Compensation for unfair dismissal is not unlimited. There are two separate awards: a basic award (based on your age, length of service, and weekly pay) and a compensatory award (based on what you've lost and your prospects).

The combined maximum is currently £123,543 as of April 2026, though this figure changes annually.

The basic award is calculated like redundancy pay. It depends on your age, length of service, and weekly pay (capped at £645 per week as of April 2026).

• Under 22: 0.5 week's pay per year of service (maximum 2 weeks)
• Age 22–40: 1 week's pay per year of service
• Age 41+: 1.5 weeks' pay per year of service (maximum 20 weeks)

Example: You're 35, worked there 8 years, and earn £400/week. Basic award = £400 × 8 = £3,200.

This covers what you've actually lost: lost wages from dismissal to now, loss of future earnings (if you haven't found new work), loss of benefits, pension rights, and any other financial damage.

• Lost wages: From dismissal date until now or until you found new work
• Future loss: If dismissed earning £30,000/year but now earning £22,000, the difference is claimed (limited to a reasonable future period, usually 2-3 years)
• Benefits: Loss of pension contributions, health insurance, bonus
• Other losses: Court/tribunal costs, professional fees

You have a duty to mitigate—meaning you must take reasonable steps to find new work. If you sit idle and claim lost wages for 2 years, a tribunal will reduce your award because you could have found work sooner.

Job searching, taking lower-paid work, retraining—these show you're mitigating. The more effort you show, the higher your award will be.

• Contributory fault: If you contributed to your dismissal (misconduct, poor performance), compensation can be reduced up to 100%
• Failure to mitigate: If you haven't tried to find work, compensation is reduced
• No reasonable chance of reinstatement: If you couldn't realistically be reinstated anyway, compensation is reduced

Compensation for automatically unfair dismissal (pregnancy, whistleblowing, etc.) is often higher because the basic award cannot be reduced for contributory fault, and tribunals typically award more for compensatory loss.