Polkey reduction: how tribunals reduce compensation
A plain-English guide to what a Polkey reduction means, how much it can reduce unfair dismissal compensation, and what published tribunal judgments show about how often it is applied.
Quick answer
A Polkey reduction is a discount to unfair dismissal compensation where the tribunal finds the employee might have been dismissed anyway, even if the employer had followed a fair process.
It does not mean the dismissal was fair. It means the tribunal reduces compensation to reflect the chance that the job would still have ended. In the published unfair dismissal judgments measured here, Polkey was applied in 6.2% of cases, with detected reductions ranging from 0% to 100%.
Applied
6.2%
151 of 2,424 cases
Engaged
18.3%
mentioned or decided
Avg reduction
63.8%
0% to 100% range
What is a Polkey reduction?
In an unfair dismissal case, a tribunal can decide that the employer used an unfair procedure but that the employee would still have been dismissed, or might still have been dismissed, if a fair procedure had been followed.
That is commonly called a Polkey reduction. It does not mean the dismissal was fair. It means the compensation is reduced to reflect the chance that the employment would have ended anyway.
This matters because a claimant can win unfair dismissal and still see the compensatory award cut sharply. Where a clear percentage was detected, the average reduction was 63.8%.
What Tribunal Intel found
The audit scanned 2,424 successful or partially successful first-instance unfair dismissal decisions. It excluded EAT cases and procedural-only rulings, then focused on published cases where the employee had at least some success.
Polkey was engaged in 443 cases (18.3%). A reduction was detected as applied in 151 cases (6.2%). In another 113 cases, the tribunal appeared to reject or decline a Polkey reduction.
| Year | Scanned | Polkey engaged | Applied | Average reduction |
|---|---|---|---|---|
| 2026 | 204 | 10.8% | 5.4% | 55.0% |
| 2025 | 926 | 17.7% | 6.5% | 64.7% |
| 2024 | 816 | 14.2% | 4.0% | 75.5% |
| 2023 | 155 | 27.7% | 8.4% | 65.7% |
| 2022 | 118 | 30.5% | 12.7% | 55.2% |
| 2021 | 130 | 30.0% | 9.2% | 50.8% |
Can a Polkey reduction be 100%?
Yes. A 100% Polkey reduction can happen where the tribunal finds the claimant would have been fairly dismissed in any event. In that situation, the unfair dismissal finding may still matter, but the compensatory award can be reduced to nil.
Lower reductions are also common. A tribunal may decide there was only a percentage chance that a fair process would have ended in dismissal, then reduce compensation by that percentage.
Examples where it was applied
100% reduction
The tribunal found the claimant would have been fairly dismissed in any event.
75% chance of fair dismissal
The judgment recorded a 75% chance that dismissal would have happened after a fair process.
50% reduction
The claim succeeded, but compensation was discounted for the chance employment would have ended anyway.
Examples where it was not applied
No basis for a Polkey deduction
The tribunal found the constructive unfair dismissal claim succeeded and rejected a Polkey discount.
No argument advanced
The judgment recorded that the respondent had not advanced a Polkey argument.
No chance of fair dismissal
The tribunal found there was no chance the claimant would have been fairly dismissed in any event.
What this means for a loss schedule
If you are preparing a statement of loss, set out the losses you say were caused by the dismissal first. If Polkey is relevant, model it separately as a settlement or risk scenario, so it is clear what you are claiming and what the award might look like if the tribunal applies a discount.
For claimants, the statement of loss should normally start from the full claim. Polkey is better treated as a settlement or risk scenario unless you are deliberately making a concession. For employers, the key question is evidence: what fair process should have happened, and what would probably have happened after it?
Polkey reduction FAQs
What is a Polkey reduction?
A Polkey reduction is a discount to unfair dismissal compensation where the tribunal finds the employee would have been dismissed, or might have been dismissed, even if the employer had followed a fair process.
Does a Polkey reduction mean the dismissal was fair?
No. A tribunal can find the dismissal was unfair and still reduce compensation because the employment may have ended anyway after a fair process.
Can a Polkey reduction be 100%?
Yes. If the tribunal finds the claimant would definitely have been fairly dismissed in any event, the compensatory award can be reduced by 100%.
Is Polkey the same as contributory fault?
No. Polkey is about what would probably have happened after a fair process. Contributory fault is about whether the claimant's own conduct contributed to the dismissal.
How do you calculate a Polkey reduction?
The tribunal applies a percentage discount to the compensatory award to reflect the chance that dismissal would still have happened. A 40% Polkey reduction would reduce the relevant compensation by 40%.
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