Employment tribunal compensation for unfair dismissal can, in certain circumstances, come with a sting in the tail: an uplift for failing to follow the Acas Code of Practice on Disciplinary and Grievance Procedures.

This additional award doesn’t compensate an employee for any extra loss. Instead, it’s designed to encourage employers to follow fair procedures. Where an employer has unreasonably failed to comply with the Code, a tribunal can increase compensation by up to 25%.

The good news for HR is that this is one of the most manageable areas of tribunal risk. Good processes, sensible record keeping and managers who understand the basics can make all the difference.

The uplift

The power to award an uplift comes from section 207A of the Trade Union and Labour Relations (Consolidation) Act 1992.

Importantly, an uplift is not automatically applied simply because an employer has failed to follow the Acas Code. The tribunal must first decide whether the failure was unreasonable before considering whether it is just and equitable to increase compensation.

The Code itself applies to disciplinary situations, including:

  • misconduct;
  • poor performance; and
  • disciplinary dismissals.

It does not apply to:

  • redundancy dismissals; or
  • the expiry of fixed-term contracts.

The procedural requirements are familiar territory for most HR professionals:

  • carry out a reasonable investigation;
  • explain the allegations;
  • hold a disciplinary meeting;
  • allow the employee to be accompanied;
  • reach a fair decision; and
  • offer a right of appeal.

None of this is new. Yet tribunals continue to see cases where one or more of these fundamental steps has been skipped altogether or reduced to a box-ticking exercise.

When will a tribunal award an uplift?

A common misconception is that any breach of the Code automatically attracts a 25% uplift.

It doesn’t.

The Employment Appeal Tribunal has made clear that tribunals should work through a series of questions:

  • Does the Acas Code apply?
  • Was it breached?
  • If so, was that breach unreasonable?
  • If it was, would an uplift be just and equitable – and if so, by how much?

That approach gives tribunals considerable flexibility. Not every procedural failing will justify an uplift and, even where one is awarded, it won’t necessarily be the maximum.

What do the cases tell us?

Case law provides some useful guidance on where tribunals are likely to take a particularly dim view of an employer’s conduct.

In Rentplus UK Ltd v Coulson, the disciplinary process was effectively predetermined. The EAT agreed that the tribunal had been entitled to award the maximum 25% uplift because the procedure was little more than a sham.

Similarly, in Hargreaves v Wright Foundation Research Ltd, an employee was dismissed for alleged misconduct without any disciplinary hearing at all. Unsurprisingly, the tribunal considered that to be a serious procedural failure and again awarded the full 25% uplift.

These decisions underline an important point. Tribunals are less interested in minor technical defects than in whether the employee was genuinely afforded a fair disciplinary process.

It’s not always 25%

Although the headlines often focus on the possibility of a 25% uplift, this is the ceiling – tribunals will carefully consider the actual percentage to award.

In doing this, they stand back and consider the overall picture, including:

  • the seriousness of the procedural failures;
  • whether there were multiple breaches;
  • why those failures occurred;
  • the impact on the employee; and
  • any mitigating circumstances.

They must also consider whether the financial outcome is proportionate.

The recent EAT decision in Sheikholeslami v University of Edinburgh illustrates the point. Although the tribunal initially considered that a 25% uplift reflected the seriousness of the employer’s failings, the compensation award was later increased dramatically to over £1.7 million. Rather than applying a full 25% increase, the tribunal reduced the uplift to 2.5%, producing what it considered to be a just and equitable overall result. The EAT upheld that approach.

The lesson is that tribunals are looking for fairness and proportionality.

The practical takeaway

Most Acas Code uplifts don’t arise because employers deliberately set out to act unfairly. They arise because procedures are rushed, managers cut corners or key decisions aren’t properly documented. All of this is going to become so much more important from January 2027 when the current compensatory cap on ordinary dismissal claims is removed (although Sheikholeslami is helpful in showing that, if the overall award is high – which it may well be once the cap is removed – that might lead to a lower percentage uplift).

For HR teams, the practical priorities remain straightforward:

  • make sure managers understand the Acas Code;
  • follow a fair process from start to finish;
  • document not only the decision, but how it was reached;
  • keep clear records of investigations, meetings and appeals; and
  • avoid treating the disciplinary process as a foregone conclusion.

Finally, it’s worth remembering that the Acas Code is no longer the only source of potential tribunal uplifts. Employers can also face uplifts of up to 25% for failing to comply with the statutory Code of Practice on Dismissal and Re-engagement or, in sexual harassment claims, for failing to take reasonable steps to prevent sexual harassment.