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Unfair Dismissal Compensation Calculator

Calculates the potential compensation award for an unfair or constructive dismissal claim in the UK, including basic and compensatory awards.

Your details

Your age on the date of dismissal.

Full years and months of continuous employment with this employer. Enter years as a decimal (e.g., 5.5 for 5 years 6 months). For the basic award, any period of 6 months or more in a year counts as a full year.

Your average gross weekly pay before tax, as used for statutory calculations.

Your average take-home pay per week after tax and National Insurance. Used for a more accurate loss calculation. If unknown, leave blank.

The number of weeks you expect to be out of work or earning less. The tribunal will assess this based on your efforts to mitigate loss.

Select the basis for calculating ongoing loss after the initial period.

If you selected 'Ongoing lower-paid work', enter your estimated ongoing weekly loss. For 'Pension loss only', enter the weekly pension contribution value lost.

Estimated number of years the ongoing loss (lower pay or pension loss) will continue. Maximum typically to retirement age.

Result

Total potential compensation £25,900.00

Sum of basic award and compensatory award. This is the total potential compensation.

How it is calculated

Capped weekly pay for basic award Your gross weekly pay, capped at the statutory limit.
£700.00
Age multiplier Multiplier based on your age: 0.5 for under 18, 1 for 18-21, 1.5 for 22-40, 1 for 41 and over.
1
Years of service multiplier One week's pay per full year of service, up to a maximum of 20 years. Any period of 6 months or more counts as a full year.
13
Basic award calculation Capped weekly pay × age multiplier × years of service.
£9,100.00
Basic award The statutory redundancy-style award for unfair dismissal.
£9,100.00
Weekly loss used for calculation Net weekly pay if provided, otherwise estimated as 70% of gross pay.
£560.00
Immediate financial loss Weekly loss × estimated weeks out of work.
£16,800.00
Future loss calculation Calculates ongoing lower pay loss or pension loss over the specified years.
£0.00
Total compensatory award (before cap) Sum of immediate and future financial losses.
£16,800.00
Compensatory award Award for financial loss, capped at the statutory limit.
£16,800.00
Keep in mind
  • This calculator provides an estimate based on statutory limits and common tribunal approaches. The actual award is at the tribunal's discretion.
  • Statutory limits change every April. This calculator uses the 2025-26 figures.
  • You must usually have 2 years' continuous service to claim unfair dismissal (with some exceptions).
  • You are expected to mitigate your loss (look for new work). The tribunal may reduce the award if you don't.
  • This calculator does not cover additional awards for failure to follow the ACAS Code of Practice.
  • For the basic award, years of service are rounded: any period of 6 months or more counts as a full year.

Indicative result, calculated from the details and the rules listed below. It does not replace an official calculation or advice from a professional.

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Unfair Dismissal Compensation in the UK

If you have been dismissed unfairly or constructively from your job in the United Kingdom, you may be entitled to compensation. This is awarded by an Employment Tribunal if your claim is successful. Compensation typically consists of two parts: a basic award and a compensatory award. This article explains how these awards are calculated and what factors influence the final amount.

The Basic Award

The basic award is calculated similarly to a statutory redundancy payment. It is based on your age, length of continuous service, and your gross weekly pay, which is subject to a statutory cap. The formula is:

  • Weekly Pay: Your average gross weekly pay, capped at a limit set by the government (currently £700 for the 2025-26 tax year).
  • Age Multiplier:
    • 0.5 for each full year of service under age 22.
    • 1 for each full year of service between ages 22 and 40.
    • 1.5 for each full year of service aged 41 or over.
  • Service: You receive the above multiplier for each full year of service, up to a maximum of 20 years. Any period of 6 months or more in a year counts as a full year.

For example, a 45-year-old employee with 12.5 years of service (where the 0.5 counts as a full year, making 13 years) and a gross weekly pay of £800 would have their pay capped at £700. Their age multiplier is 1 (for ages 41 and over). Their basic award would be £700 × 1 × 13 = £9,100.

The Compensatory Award

This award compensates you for the actual financial loss suffered as a result of the dismissal. It aims to put you in the position you would have been in had you not been dismissed. Key components include:

  • Immediate Loss of Earnings: Your net weekly take-home pay (or an estimate of it) multiplied by the number of weeks you are out of work. You are expected to look for new work to mitigate your loss.
  • Future Loss: If you find a new job but at a lower salary, you may claim the difference for a reasonable period. Loss of pension contributions can also be included.
  • Statutory Cap: The total compensatory award is subject to an overall cap, which is reviewed annually. For dismissals occurring on or after 6 April 2025, the cap is £105,000.

Example Calculation

Consider Sarah, aged 38, dismissed after 8 years. Her gross weekly pay was £950, and her net pay was not provided, so it is estimated at 70% of gross, which is £665. She was unemployed for 20 weeks, after which she found a new job paying £150 less per week. She expects this pay difference to continue for 5 years.

  1. Basic Award: Capped weekly pay (£700) × Age multiplier (1.5 for age 38) × Years of service (8) = £8,400.
  2. Compensatory Award - Immediate Loss: Net weekly pay (£665) × 20 weeks = £13,300.
  3. Compensatory Award - Future Loss: Weekly loss (£150) × 52 weeks × 5 years = £39,000.
  4. Total Compensatory Before Cap: £13,300 + £39,000 = £52,300. This is below the £105,000 cap.
  5. Total Compensation: £8,400 (Basic) + £52,300 (Compensatory) = £60,700.

Another example: John, aged 60 with 25 years of service, suffers a pension loss of £50 per week after dismissal. He expects this loss to continue for 8 years. His compensatory award for pension loss would be £50 × 52 × 8 = £20,800.

What to Do Next

Before making a claim to an Employment Tribunal, you must usually notify ACAS and attempt Early Conciliation. This is a free service that tries to help you and your employer reach a settlement. If conciliation fails, you can proceed with a tribunal claim, but strict time limits apply (generally 3 months minus one day from your dismissal date).

It is advisable to prepare a clear record of events and your financial losses. Our Disciplinary Appeal Letter or Grievance Appeal Letter templates can be useful first steps in formally challenging a dismissal decision internally.

Frequently Asked Questions

Do I qualify for unfair dismissal?
You usually need at least two years of continuous service with your employer. There are exceptions, such as if you were dismissed for whistleblowing, for pregnancy, or for trying to enforce a statutory right.

What is constructive dismissal?
This occurs when your employer's conduct is so serious that it breaches your contract, forcing you to resign. Examples include significant changes to your role without agreement, bullying, or not paying you. The compensation calculation is the same as for unfair dismissal.

Can my compensation be reduced?
Yes. If the tribunal finds you contributed to your dismissal (e.g., through misconduct), it can reduce your award by a percentage. Your award will also be reduced if you fail to look for new work to mitigate your loss.

Are legal fees included?
No. Tribunal awards do not typically cover your legal costs. You may be able to get free advice from Citizens Advice or a trade union.

Frequently asked questions

How long do I have to make an unfair dismissal claim?

You must contact ACAS to start Early Conciliation within 3 months minus one day from the date your employment ended. The conciliation period pauses the clock, but you must not delay.

What if I was dismissed with less than 2 years service?

You may still have a claim if the reason for dismissal was automatically unfair, such as for whistleblowing, pregnancy, or trade union activities. In such cases, the 2-year service requirement does not apply.

Is the compensatory award taxed?

The first £30,000 of a termination payment (which can include compensation awards) is usually tax-free. Amounts above that may be subject to income tax and National Insurance. You should seek independent tax advice.

What is the ACAS Code of Practice?

It sets out principles for handling disciplinary and grievance procedures. If an employer unreasonably fails to follow it, a tribunal can increase your award by up to 25%. Similarly, if you fail to follow it, your award could be reduced.

Can I claim for injury to feelings in an unfair dismissal case?

Generally, no. Injury to feelings awards are typically only available in discrimination claims, not ordinary unfair dismissal claims.

What if I've already found a new job?

You should still calculate your loss. If your new job pays less, you can claim the difference for a period. If you found a job quickly, your 'weeks of loss' will be lower, reducing the immediate loss part of the compensatory award.

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