How much compensation can you get for unfair dismissal?

That is the number to plan around. Not the cap. Not the largest reported award you found on Google. Anyone who leads with the cap is selling you something.

The cap

The Commission cannot order more than the lesser of:

• 26 weeks of your remuneration, or
• half the high income threshold, currently $95,050.

Awards anywhere near the cap are uncommon.

Reinstatement comes first

The Act makes reinstatement the primary remedy. The Commission cannot order compensation unless it is satisfied that reinstatement is inappropriate. In practice reinstatement is ordered infrequently, and most applicants do not want it. But it is the starting point, not an afterthought.

How the Commission works out the number

Where compensation is ordered, the Commission follows an established approach:

1. Estimate what you would have earned had you not been dismissed. How long would the employment have continued? This is often the single most important figure, and for a short-service employee in a marginal role it can be very small.
2. Deduct what you have actually earned since the dismissal, and what you are likely to earn between now and the decision.
3. Adjust for contingencies, meaning the ordinary risks that the employment might have ended anyway.
4. Consider whether to reduce the amount for misconduct on your part that contributed to the dismissal.
5. Apply the cap.
6. Consider the effect on the employer's viability, particularly for small businesses.

What compensation does not cover

The Act expressly excludes any component for shock, distress, humiliation, or other hurt caused by the dismissal. If the dismissal was humiliating, that does not increase the number. This surprises almost everyone.

Compensation is also not punitive. It is not a fine on the employer.

What actually happens

Most matters never reach a compensation decision. They settle at conciliation, and the settlement figure reflects what both sides think a hearing would produce, discounted for cost, delay and risk. That is why the realistic conversation is about weeks of pay rather than the statutory maximum.

Mitigate your loss

Look for work, keep records of your applications, and keep your payslips from any new job. Your efforts to find work directly affect the number.

Call 1800 UNFAIR for a realistic assessment. We will not quote you a range we cannot justify.