Mitigation of loss

After a dismissal, you are under a duty to take reasonable steps to limit your financial loss — typically by looking for new work. Failing to do so without good reason can reduce your tribunal award even when the dismissal was clearly unfair.

What is the duty to mitigate in employment tribunal claims?

In an unfair dismissal claim, you are under a duty to take reasonable steps to find new employment and reduce your financial loss. This obligation comes from ERA 1996 s.123(4) and the common law principle applicable to all compensation claims. The duty starts from the day of dismissal — not from the date of the tribunal claim or hearing. Failing to look for work can result in the tribunal reducing the compensatory award to reflect the earnings you should have received.

Who has to prove I failed to mitigate?

The burden of proof sits firmly on the employer. The employer must produce evidence that you failed to take reasonable steps and that suitable jobs were available. This was confirmed in Gardiner-Hill v Roland Berger Technics [1982] IRLR 498. If the employer cannot show what work was available and that you could reasonably have obtained it, the tribunal should not reduce the award for failure to mitigate.

What counts as reasonable steps to mitigate?

Reasonable steps include: applying for jobs at the same or similar level to your previous role; registering with recruitment agencies; using online job boards and professional networks; approaching former colleagues and industry contacts; and updating your curriculum vitae. You are not required to accept any job at any salary — only suitable work at an appropriate level. Retraining, starting a business, or part-time work to bridge a gap can all count as reasonable mitigation.

Do I have to accept a lower-paid job to mitigate my loss?

Not necessarily. The test is whether the job is suitable having regard to your skills, experience, and previous salary. A highly experienced professional is not expected to take a minimum-wage role simply because it is available. However, if you have been unemployed for a long period without success, the tribunal may expect you to cast a wider net — including roles at a lower level or salary than your previous position.

What evidence should I keep of my job search?

Keep a contemporaneous log of every application you make: date, employer, role title, salary, how you applied, and the outcome. Save copies of applications, rejection emails, and correspondence with recruiters. Record attendance at interviews. This evidence is vital if the employer challenges your mitigation. Without a log, you are relying on memory against an employer who may bring evidence of unanswered job adverts.

Does mitigation affect the basic award as well as the compensatory award?

No. The duty to mitigate applies only to the compensatory award under ERA 1996 s.123(4). The basic award is a fixed formula based on age, service, and weekly pay — it is not reduced for failure to mitigate. Only the compensatory award, which compensates actual financial loss, is subject to the mitigation duty.

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Last reviewed: June 2026

is the obligation on a dismissed employee to take

reasonable steps to find new work

and reduce their financial loss — under

— with the burden of proving failure to mitigate falling on the employer, not on you.

Where this comes from

— reduces the compensatory award where the claimant failed to mitigate loss.

Gardiner-Hill v Roland Berger Technics

— confirmed the burden of proving failure to mitigate rests on the respondent employer, not the claimant.

Wilding v British Telecommunications

— the test is whether a reasonable person in the claimant

s position would have accepted the job or opportunity offered.

When the duty starts and what it requires

The duty to mitigate begins

on the day of dismissal

— not from the date you file a claim, and not from the date of a hearing. From that day, you are expected to take reasonable steps to limit your losses.

What is reasonable depends on your specific circumstances: your skills, experience, salary expectations, and the state of the local and national job market. A senior specialist is not expected to take the first minimum-wage role that comes along. But sitting at home for six months without making any applications is not reasonable for most people.

Steps that typically count as reasonable mitigation include: applying for jobs at a similar level and salary; registering with recruiters; attending networking events; and — after a period without success — broadening the search to adjacent roles or slightly lower salary bands.

Job-search record: what to keep

• Date of each application
• — keep a running log with the exact date.
• Employer and role title
• — note the company and the position applied for.
• Salary offered or advertised
• — relevant to whether the role was suitable.
• — online portal, email, recruiter, direct approach.
• — rejection, no response, interview, offer.
• Copies of applications and correspondence
• — save everything. Email trails are ideal evidence.
• — names, agencies, dates registered.

as a marketing manager. She was dismissed on 1 March. By 26 April —

— the tribunal finds she could reasonably have found comparable work at £550 per week, had she applied more actively. She actually found work at £530 per week on 1 June (13 weeks after dismissal).

Actual loss: 13 weeks × £600

Mitigation reduction: 5 weeks × £600 (weeks 8-13 she should have been working)

Compensatory award for this head

The tribunal does not eliminate Diana

s award — it adjusts it to reflect the period of loss she could reasonably have avoided. The 5-week reduction represents the gap between when she should have found work and when she actually did.

When the employer raises re-engagement as mitigation

, if an employer offers re-engagement and the claimant refuses, the tribunal must ask whether a reasonable person in the claimant

s position would have accepted. If the offer was genuinely suitable and was refused without good reason, the award can be reduced accordingly. Fear of further unfair treatment, hostile working environment, or a genuine loss of trust can justify refusal — but the claimant should be ready to explain why.

• Starting the job search late.
• The duty starts at dismissal. A claimant who waited months before applying for anything faces a real risk of a large reduction.
• Without a contemporaneous log, it is your word against the employer
• s on what was available and what steps you took.
• Refusing a reasonable re-employment offer.
• If the original employer offers to take you back on reasonable terms, refusing without good reason can reduce the award significantly.
• Applying only for identical roles.
• After a period without success, the tribunal expects the search to broaden. Refusing to consider adjacent roles or slightly lower salaries can be treated as unreasonable.

Frequently asked questions

Sources & further reading

• Gardiner-Hill v Roland Berger Technics
• [1982] IRLR 498 — burden on employer
• Wilding v British Telecommunications plc
• [2002] EWCA Civ 349 — reasonable person test
• Unfair dismissal compensation

Need to record your job search?

Start My Claim helps you structure your mitigation evidence and build a schedule of loss that reflects your efforts to find new work.

Last reviewed: June 2026.

ERA 1996 s.123(4) current. Case law citations confirmed.

This page is explanatory only and is not legal advice. Start My Claim is self-service software, not a law firm.