If you are made redundant in the UK after two years, you are usually entitled to statutory redundancy pay, based on your age, length of service and weekly pay. Here is how it is worked out.
You are usually entitled to statutory redundancy pay if you are an employee with at least two years of continuous service and you are made redundant. It is separate from any notice pay and from enhanced redundancy your contract may offer.
Statutory redundancy pay is based on three things: your age, your length of continuous service (capped at 20 years), and your weekly pay (capped at a statutory limit that is updated each year). For each full year of service you get an amount that depends on your age during that year.
The statutory weekly pay cap changes each year, so use the latest official figure when you calculate, and remember that your employer may offer enhanced redundancy above the statutory minimum. Redundancy pay up to a threshold is normally tax-free.
Also useful for UK workers UK Take-home Pay Calculator, Holiday Entitlement Calculator.
How is statutory redundancy pay calculated?
It is based on your age, length of service (capped at 20 years) and weekly pay (capped at a yearly statutory limit). You get 0.5 week's pay for each full year worked under 22, 1 week for each full year aged 22 to 40, and 1.5 weeks for each full year aged 41 or over.
Who is entitled to redundancy pay?
Employees with at least two years of continuous service who are made redundant are usually entitled to statutory redundancy pay. It is separate from notice pay and from any enhanced redundancy in your contract.
Is redundancy pay taxed?
Statutory redundancy pay is normally tax-free up to a threshold. Amounts above the threshold, or payments that are not genuine redundancy, may be taxable, so check your specific situation.
Is there a limit on redundancy pay?
Yes. Only your most recent 20 years of service count, and your weekly pay is capped at a statutory limit that is updated each year, so statutory redundancy pay has a maximum.
Please note: Outputs are AI-generated and can contain errors. Use them as a starting point and check anything important before you act on it.
Work out your UK take-home pay and plan ahead with the Take-home Salary Calculator, using current PAYE and NI figures.
Calculate your redundancy pay