Compensatory Award

A compensatory award is awarded in most cases where a claim for unfair dismissal is successful.

Circumstances where no compensatory award is made:

• 100% contribution
• 100% chance dismissal would have occurred

Circumstances where a limited compensatory award is made:

• Where a finding of contribution is made below 100%
• Where a Tribunal finds that dismissal may have occurred but put the percentage at below 100%

The maximum compensatory award is approximately £60,000.00 and is usually increased at or above inflation each year. Awards over £30,000.00 are grossed up to account for income tax. Therefore an employee may be awarded £60,000.00 net but the cost to the employer is either £66,000.00 or £72,000.00 depending on whether the employee is a basic rate or higher rate tax payer.