Unfair dismissal: compensation and remedies

by Practical Law Employment (based on an original by Eversheds Sutherland)

A practice note that provides guidance on the assessment of compensation and other remedies for unfair dismissal. This note examines the remedies available under the Employment Rights Act 1996 (ERA 1996) when an employment tribunal finds a dismissal to be unfair, including reinstatement, re-engagement and interim relief. It outlines the calculation of financial compensation, covering both the basic award and the compensatory award, and addresses the application of the statutory cap. It explores the principles that tribunals apply when assessing compensation, including the various heads of loss, the "just and equitable" principle and a claimant's duty to mitigate their loss. It also considers the complex adjustments that can modify an award, such as reductions for contributory fault and Polkey deductions, which reflect the chance that a fair dismissal might have occurred regardless of procedural flaws. The note further discusses the potential for an uplift or reduction in compensation for an unreasonable failure to comply with the Acas Code of Practice on Disciplinary and Grievance Procedures or the Code of Practice on Dismissal and Re-engagement.