Who qualifies
You're normally entitled to statutory redundancy pay if you're an employee and you've worked for your current employer for 2 years or more (GOV.UK). Length of service below two years means no statutory payment — though your contract or your employer's own redundancy policy may still pay something, and many do.
Statutory redundancy pay is the legal floor, not the ceiling. Employers can and often do pay enhanced redundancy packages above the statutory figure, particularly where a settlement agreement is involved — see our page on settlement agreements.
The formula
Statutory redundancy pay is calculated from your age, your length of service and your weekly pay. Per GOV.UK, you get: half a week's pay for each full year you were under 22; one week's pay for each full year you were 22 or older but under 41; and one and a half week's pay for each full year you were 41 or older.
Two caps apply. Length of service is capped at 20 years. And your weekly pay is capped: from 6 April 2026 the cap is £751 a week, which makes the maximum possible statutory redundancy payment £22,530 (GOV.UK). If you earn more than £751 a week, the excess simply doesn't count in the statutory calculation.
Your weekly pay for the calculation is the average you earned per week over the 12 weeks before the day you got your redundancy notice (GOV.UK). If your pay varies — overtime, shift patterns, commission — check which weeks were used, because the averaging window can materially change the figure.
Check the figure yourself
Don't take the number in your redundancy letter on trust — most are right, but errors happen, and they are almost always in the employer's favour when they do. GOV.UK publishes an official calculator that applies the age bands, the 20-year cap and the current weekly cap for you.
Cross-check three inputs: your start date (continuous service, including any TUPE transfer), your age at each year of service (the bands apply per year worked, not your age today), and the weekly pay figure used. If any of the three is wrong, the total is wrong.
When it's paid, and what it sits alongside
Statutory redundancy pay is separate from your notice pay, any accrued holiday pay, and anything enhanced your employer offers. Each is calculated on its own rules — see notice periods for what notice you're owed, and tax on redundancy pay for which parts of the total are taxable.
Statutory redundancy pay under £30,000 is not taxable (GOV.UK) — but other elements of a termination payment, like holiday pay and unpaid wages, are taxed as normal earnings, so the headline figure in your letter is not what lands in your account.
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Sources for this page (4) — every claim above traces to one of these
- GOV.UK — Redundancy: your rights — Redundancy pay
- GOV.UK — Calculate your statutory redundancy pay
- GOV.UK — Redundancy: your rights — Tax and National Insurance
- Acas — Your rights during redundancy
Details verified against these sources as of 2026-08-15. Employment law changes — the Employment Rights Act 2025 is rolling out through 2026 and 2027 — and your contract or your employer's own policies may give you more than the statutory minimums described here. This page is general information, not legal or tax advice: for your specific situation, use the free Acas helpline or take independent legal advice (which the law requires anyway before a settlement agreement is binding).