A character can carry equipment which has a total ENC of less than or equal to their STR+SIZ without penalty.
Encumbrance is a measure of not only weight but also the bulk of the item, reflecting the awkwardness of handling the item. Roughly 1 ENC is equal to 1/4 of a SIZ point.
A character carrying total ENC greater than their STR+SIZ is Overloaded.
Overloaded characters suffer a –20% penalty to all tests that require physical actions, including Weapon skill tests and most tests that have DEX or STR as a Characteristic.
Overloaded characters have their Movement halved. They also suffer a –20% penalty to all Fatigue tests.
A character cannot carry more than twice their STR+SIZ in ENC.