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Encumbrance reduces the Damage and Attack Speed of your Melee and Archery, it also reduces your Magic Magnitude and Cast Speed.

Icon Encumbrance Reduction Description
Armor Proficiency 150.0 Every point of Encumbrance adds 0.75 points to your Melee Encumbrance once you go above 150 Encumbrance.
Armored Archery 50.0 Everypont of Encumbrance adds 1.0 points to your Archery Encumbrance once you go above 50 Encumbrance.
Armored Casting 20.0 Everypont of Encumbrance adds 1.0 points to your Magic Encumbrance once you go above 20 Encumbrance.