How statutory redundancy pay is worked out
Statutory redundancy pay is based on three things: your age, how many full years you have worked for your employer, and your weekly pay. For each full year of service you get:
| Age during that year of service | Pay for each full year |
|---|---|
| Under 22 | Half a week's pay |
| 22 to 40 | One week's pay |
| 41 and over | One and a half weeks' pay |
Only your most recent 20 years count, and weekly pay is capped at £751 for redundancies on or after 6 April 2026. Weekly pay means your gross pay before tax, averaged over the 12 weeks before you were given notice if your hours or pay vary. Our guide to redundancy pay explains the rules in more detail.
A worked example
Sam is 45, has worked for the same employer for 10 years and earns £600 a week. The four years Sam worked aged 41 to 44 count at one and a half weeks each (6 weeks), and the six years aged 35 to 40 count at one week each (6 weeks). That is 12 weeks in total, so Sam's statutory redundancy pay is 12 x £600 = £7,200. Because £600 is below the £751cap, Sam's full weekly pay is used.
Notice pay and pay in lieu of notice
Notice pay is separate from redundancy pay and is paid on top of it. By law you get at least one week's notice after one month of service, rising to one week for each full year up to a maximum of 12 weeks, although your contract may give you more. Notice pay is based on your full pay, is not capped, and is taxed as normal earnings, including when it is paid in lieu of notice. Read more in our guide to redundancy notice periods.
Is redundancy pay taxed?
The first £30,000 of a redundancy payment is free of tax and National Insurance. Anything above that is taxed. Statutory redundancy pay alone can never exceed £22,530, so it is always tax free, but notice pay, holiday pay and unpaid wages are taxed in the usual way.
When you might be owed more
The calculator shows the legal minimum. You could be entitled to more if your contract or staff handbook includes an enhanced redundancy scheme, if you were unfairly selected, or if your employer did not consult you properly before making you redundant. If you have been offered a settlement agreement, you must get independent legal advice before signing, and your employer usually contributes to the cost. Our guide to your redundancy rights covers what a fair process looks like.
Redundancy pay FAQs
Who qualifies for statutory redundancy pay?
Employees with at least 2 years of continuous service with their current employer. Workers, the self-employed and some groups such as Crown servants, members of the armed forces, police officers and share fishermen are not entitled. You may also lose the right if you unreasonably turn down suitable alternative work offered by your employer.
Does service before I turned 18 count?
Yes. Every full year of continuous service counts, including years before age 18. Years worked while aged under 22 count at half a week’s pay.
Is my pay capped?
Yes. For redundancies on or after 6 April 2026, weekly pay is capped at £751, so the most you can receive in statutory redundancy pay is £22,530. Your employer or contract can pay more than this.
What if I have worked there for less than 2 years?
You will not get statutory redundancy pay, but you are still entitled to notice pay and any holiday pay you are owed. If your selection was linked to discrimination, pregnancy or whistleblowing, you may have a claim regardless of length of service.
What if my employer will not pay?
Raise it in writing first. If your employer still refuses, you can make a claim to an employment tribunal. If your employer is insolvent, you can apply to the government’s Redundancy Payments Service instead.
How long do I have to claim?
You normally need to ask your employer for the payment, or make a tribunal claim, within 6 months of the date your employment ended.
Last updated 9 October 2026 using April 2026 rates. Source: GOV.UK and the Employment Rights Act 1996.