In this paper, we show numerically and experimentally that expectation maximization (EM) algorithm is a powerful tool in combating system impairments such as fibre nonlinearities, inphase and quadrature (I/Q) modulator imperfections and laser linewidth. The EM algorithm is an iterative algorithm that can be used to compensate for the impairments which have an imprint on a signal constellation, i.e. rotation and distortion of the constellation points. The EM is especially effective for combating non-linear phase noise (NLPN). It is because NLPN severely distorts the signal constellation and this can be tracked by the EM. The gain in the nonlinear system tolerance for the system under consideration is shown to be dependent on the transmission scenario. We show experimentally that for a dispersion managed polarization multiplexed 16-QAM system at 14 Gbaud a gain in the nonlinear system tolerance of up to 3 dB can be obtained. For, a dispersion unmanaged system this gain reduces to 0.5 dB.