Hayes comprehensive in Bromley, Kent, has been forced to make the payment to Christopher Mitchell after being found guilty of racial discrimination.
Mr Mitchell had been covering for a sick teacher and was told he probably would be taken on permanently when a vacancy arose.
But when two posts came up the school appointed two white teachers and failed to advertise the vacancies. Mr Mitchell complained he was overlooked because he was black and said that the school had never employed a black English teacher. In a report, a three-man tribunal upheld the teacher's claims and ruled the 41-year-old from south London had received "less favourable treatment on grounds of race". It described Mr Mitchell as an "experienced and extremely competent teacher of English".
Last week the governing body of the school, which has 1,600 pupils aged 11 to 18, was ordered to compensate the teacher for loss of earnings and injury to feelings.
The school, which is considering an appeal, will be liable for the fine and all the legal costs.
After the hearing, the school said that the best people had been appointed, irrespective of race. But it admitted failing to follow recruitment procedures correctly.
Mr Mitchell, now out of work, told The TES: "I was teaching English to A-level students and other groups coming up to their exams ... and most of those pupils, on average, did better than the rest of the department."
Kieran Osborne, the school's head, who only took up his post last month, said: "A fundamental error was made and the vacancies should have been properly advertised. We accept that but deny the suggestion it had anything to do with race. As for the award, it is way out of all proportion. It is a ridiculous amount and it will send shockwaves through a number of schools."
It is rare for a claim of racial discrimination to be proven.
According to the Employment Tribunals Service, there were just 2,830 such accusations made across all sectors of industry but only 115 cases were won.