Am I entitled to statutory redundancy pay?

You qualify for statutory redundancy pay if you are an employee (not self-employed or a worker), you have been continuously employed by the same employer for at least 2 years, and you have been made redundant. Employees under 2 years' continuous service have no statutory redundancy entitlement, though your employer may offer an enhanced scheme.

How is statutory redundancy pay calculated?

Redundancy pay is based on your age, length of service, and weekly gross pay. You receive: 1.5 weeks' pay for each full year of service when you were 41 or older; 1 week's pay for each year when you were aged 22-40; and half a week's pay for each year under age 22. Service is capped at 20 years and weekly pay is capped at £751 for 2026/27. The maximum statutory payment is therefore £22,530.

Is redundancy pay taxable?

The first £30,000 of a genuine redundancy payment (including statutory redundancy pay) is tax-free. Amounts above £30,000 are taxed as income. Statutory redundancy pay alone is almost always below £30,000, so it is usually entirely tax-free. Payments in lieu of notice (PILON), holiday pay, and bonuses are taxed normally and do not benefit from the £30,000 exemption.

Does my employer have to pay more than the statutory amount?

No. The statutory amount is the legal minimum. However, many employers offer enhanced redundancy schemes that pay more, for example no cap on weekly pay, more weeks per year of service, or a higher multiplier. Check your employment contract and any company policies. Enhanced payments above the statutory amount are still usually tax-free up to the £30,000 limit.

What if my employer refuses to pay redundancy?

If your employer is insolvent and cannot pay, you can claim from the National Insurance Fund via the Insolvency Service and will receive the statutory amount from the government. If your employer simply refuses to pay despite being solvent, you can make a claim to an Employment Tribunal. The deadline for a tribunal claim is typically 3 months less one day from your last day of employment.

Does part-time work affect redundancy pay?

Part-time employees have the same redundancy rights as full-time employees. Weekly pay for redundancy purposes is based on a week's actual gross pay. If pay varies (for example shift work or overtime), the average weekly earnings over the 12 weeks before the redundancy notice are used.

Redundancy Pay Calculator

Calculate your statutory redundancy pay entitlement for 2026/27 based on your age, years of service, and salary.

Your details

Age at dismissal date

Complete years of continuous service

Only complete years count. Must be 2+ years to qualify.

Enter salary as

Annual gross salary

Weekly equivalent: £550.00 · Capped at £751 for statutory purposes

Your results

Redundancy Pay After 7 Years at £28,600

Statutory redundancy pay

£3,850

7.0 weeks' pay

Years counted: 7
Weekly pay used: £550.00
Total weeks' pay: 7.0 weeks
Total redundancy pay: £3,850

Breakdown

Pay breakdown by age band, working back from your current age through your years of service
Age band	Years	Multiplier	Weeks' pay	Amount
Aged 22 to 40	7	1x	7.0	£3,850
Total			7.0 weeks	£3,850

Tax treatment: The first £30,000 of a genuine redundancy payment is tax-free. Your statutory redundancy pay of £3,850 is well within this limit and is entirely tax-free.

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Frequently asked questions

Redundancy Guide

Understanding statutory redundancy pay

Statutory redundancy pay is the minimum compensation you're legally entitled to when your employer makes you redundant after two or more years of continuous service. The amount depends on your age, your length of service, and your weekly pay, all three factors combine to determine what you receive.

The age-weighted multiplier

The law assigns a different multiplier to each year of service based on your age during that year. Years worked under the age of 22 count as half a week's pay each; years worked between 22 and 40 count as one week's pay each; and years worked aged 41 or over count as one and a half weeks' pay each. Only the last 20 years of service count regardless of how long you've worked for the employer.

The weekly pay cap

Your weekly pay is capped for statutory purposes. In 2026/27 the cap is £700 per week (£36,400 annualised). If you earn more than this, the excess doesn't count toward your statutory entitlement, though your contract or a settlement agreement may provide more. Always check your employment contract and ask your employer whether they offer enhanced redundancy terms above the statutory minimum.

Tax treatment

Statutory redundancy pay is entirely tax-free. More broadly, the first £30,000 of any genuine redundancy payment, including enhanced pay agreed by your employer, is free of income tax and National Insurance. Amounts above £30,000 are taxed as income in the year you receive them. Payments in lieu of notice (PILON) are always taxable in full, as they replace salary you would have earned during your notice period.

What else you may be owed

Statutory redundancy pay is rarely the whole picture. You're also entitled to:

Notice pay: your contractual or statutory notice period (whichever is longer), usually one week per year of service up to 12 weeks.
Accrued holiday pay: any unused annual leave must be paid out at your full rate of pay.
Enhanced redundancy: many employers pay above the statutory minimum, sometimes linked to final salary rather than the capped weekly amount.

If your employer can't pay

If your employer is insolvent and cannot pay your statutory redundancy, you can claim through the Insolvency Service's Redundancy Payments Service. The government guarantees statutory redundancy pay even when the employer has gone under, subject to the same caps on weekly pay and years of service.

Statutory redundancy pay examples

Based on 2026/27 weekly pay cap of £700. Salary shown is the employee's actual salary where it affects the cap.

Age	Years of service	Weekly pay	Statutory pay
25	3 years	£500	£1,500
30	5 years	£600	£3,000
35	10 years	£700	£7,000
42	15 years	£700	£12,250
50	20 years	£700	£19,250
60	20 years (max)	£700+	£21,000

Maximum statutory redundancy is 30 weeks' pay (20 years × 1.5 for all years worked aged 41+, capped). At the £700 cap that's £21,000.

How this calculator works

What it calculates: Your minimum statutory redundancy entitlement under the Employment Rights Act 1996, using the age-weighted week formula and the 2026/27 weekly pay cap of £700.
Key assumptions: Continuous employment throughout the service period
Weekly pay capped at £700 (2026/27)
Maximum of 20 years of service counted
England, Scotland, and Wales rules (not NI)
Data sources: Employment Rights Act 1996, s.162
The Employment Rights (Increase of Limits) Order 2026
GOV.UK Redundancy: your rights
When it may not be accurate: This calculator covers statutory minimums only. Your contract or a collective agreement may provide more. It doesn't account for breaks in service, part-time adjustments, or enhanced employer schemes. Always confirm your entitlement with your HR team or an employment solicitor.

Sources & methodology

Built and maintained by UK Money Tools, a personal finance resource (not a financial adviser). Last reviewed April 2026. Rates and thresholds come from official UK government publications.

HMRC: Income Tax rates and allowances · Official rates, bands and thresholds
GOV.UK: National Insurance rates · Employee and employer NI rates
Scottish Government: Income Tax · Scottish income tax rates and bands
GOV.UK · UK government legislation and guidance
HMRC · Tax rates, thresholds and official guidance

Figures are estimates only. This is not financial or tax advice. For help with your specific situation, speak to HMRC or a qualified adviser.