Unfair dismissal basic award calculator

The basic award is one of two parts of unfair dismissal compensation. It is worked out using a fixed statutory formula - a number of weeks' pay based on your age and complete years of service - in the same way as a statutory redundancy payment. The other part, the compensatory award, covers your actual financial losses and is usually larger.

For each complete year of service you get half a week's pay for years worked under age 22, one week's pay for years worked between 22 and 40, and one and a half weeks' pay for years worked at 41 or over. A maximum of 20 years counts, a week's pay is capped at £751 (from 6 April 2026), and the basic award cannot exceed £22,530.

For ordinary unfair dismissal you normally need at least 2 years' continuous service (6 months where employment ends on or after 1 January 2027, under the Employment Rights Act 2025). Some dismissals are automatically unfair - for example for whistleblowing, pregnancy, or asserting a statutory right - and those have no qualifying period at all.

No. It works out only the statutory basic award - the part that follows a formula. The compensatory award for lost earnings and other losses is separate, usually larger, and depends on facts a calculator cannot see, such as how long you are out of work and what you do to find new work. Where the dismissal takes effect before 1 January 2027 it is capped at the lower of £123,543 or 52 weeks' pay; on or after that date the cap no longer applies. The figure here is also before any reductions that may apply.

The basic award is generally tax-free, in the same way as a statutory redundancy payment. By contrast, parts of a compensatory award above £30,000 can be taxable. This is general information, not tax advice.