Workbench: Two types of armor upgrades are available: overlays and underlays. Both types can have a wide variety of effects and often provide resistance against specific types of attacks. Some types of armor upgrades can only be used with heavier armor types. Robes cannot be upgraded with overlays, but some can benefit from a limited number of underlays.
All overlays and underlays can be created using a workbench with sufficient skill rank and components, although when armor, overlay and underlay grant the same bonuses, these don't always combine as expected or displayed in the upgraded armor's description.
Only the highest attributebonus is actually granted, so upgrading a Corellian Powersuit (Strength: +2) with a Strengthening Underlay Mark V (Strength: +3) only grants Strength: +3, not +5, according to both its description and the Character screen (among other things). However, Dexteritypenalties behave as expected (although descriptions don't always correctly display the following):
The description for this upgraded armor only displays the highest bonus for both, but after failure to save against a Plasma Grenade (and with no other damage reduction), its fire damage is reduced from 36 to 3 (36 - 36*0.5 - 15), not the expected 0 (36 - 36*0.5 - 15 - 10 - 10) or, based on the description, 11 (36 - 36*0.3 - 15), indicating a 50% reduction, not just 30%.