Compensatory Award

The Compensatory Award is potentially the largest part of an Unfair Dismissal award. It aims to compensate Cliamants for their financial losses - mainly loss of net earnings while unemployed after being unfairly dismissed, but it can include amounts for ongoing loss (where the Claimant’s new job is at a lower rate of pay than their old job) and expenses incurred in looking for another job, attending interviews etc. The Compensatory Award can be up to £63,000.00*, although in a limited range of cases, for example dismissals for health and safety reasons, it can be unlimited. The Compensatory Award can not, according to the House of Lords, compensate an employee for injury to feelings caused, for example, by the manner of dismissal.

* £63,000.00 for dismissals occuring between 1 February 2008 and 31 January 2009. The cap for 2007 - 2008 was £60,600.00 and for 2006-2007 was £58,400.00. The cap is reviewed every year and increases on 1 February.