The unfair dismissal compensatory award

The following Employment practice note provides comprehensive and up to date legal information covering:

  • The unfair dismissal compensatory award
  • Calculation
  • Statutory maximum
  • Guidance on assessing compensation
  • Loss of earnings after dismissal caused by illness or other incapacity
  • Loss of earnings after dismissal with more than one cause
  • Accelerated receipt
  • Duty to mitigate
  • Salary increases and benefits accruing post-dismissal
  • Expenses and benefits
  • More...

The unfair dismissal compensatory award

Coronavirus (COVID-19): The Employment Rights Act 1996 (Coronavirus, Calculation of a Week’s Pay) Regulations 2020 (Week’s Pay Amendment Regs 2020), SI 2020/814, which provide (among other things) that any basic award, compensatory award or additional award payable to an employee who has been furloughed under the Coronavirus Job Retention Scheme (CJRS) is calculated on the basis of their normal wages, rather than a reduced furlough rate, are considered in Practice Note: Coronavirus Job Retention Scheme—right to statutory redundancy and other termination payments.

An award of compensation for unfair dismissal generally consists of a basic award and a compensatory award. The compensatory award is intended to compensate the employee for financial losses suffered as a result of the unfair dismissal. It may be subject to various increases or deductions.

The basic award is considered in Practice Note: The basic award.

For guidance on unfair dismissal remedies generally, see Practice Note: Unfair dismissal remedies—general.

See also the Lexis®Calculate online calculators:

  1. basic award calculator, and

  2. Lexis®Calculate Employment: unfair dismissal schedule of loss application (and the related Practice Note: Guide to using the Lexis®PSL Employment Schedule of Loss application)


The compensatory award is such amount as the tribunal considers just and equitable in all the circumstances having regard to the loss sustained by the employee as a result of dismissal and in so far as

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