How statutory redundancy pay is calculated in the UK
Statutory redundancy pay in Great Britain is a legal minimum based on your age during each year of service, how many complete years count (capped at 20), and weekly pay after the statutory cap. Understanding the method helps you spot mistakes in an employer spreadsheet — and in any online tool, including ours.
Eligibility in plain terms
You generally need at least two complete years of continuous employment with the employer who is making you redundant. The payment is tied to dismissal by reason of redundancy. If you resign without a qualifying dismissal, or if the real reason is misconduct, the statutory scheme usually does not apply. Enhanced contractual schemes can pay more than the statute; they cannot normally pay less than the statutory floor where the statute applies.
The year-by-year method
GOV.UK-style calculators work backwards from the relevant date. For each complete year of service (up to 20), they ask how old you were during that year and award 0.5, 1, or 1.5 weeks of pay. Those weeks are summed, then multiplied by weekly pay after the weekly cap. Finally, the overall maximum for that tax year’s limits can truncate the total.
- Under 22: 0.5 week’s pay per complete year
- 22–40: 1 week’s pay per complete year
- 41+: 1.5 weeks’ pay per complete year
Caps from 6 April 2026
For relevant dates on or after 6 April 2026, the weekly cap is £751 and the overall maximum statutory payment is £22,530. If your redundancy date is earlier, use the prior year’s limits (£719 / £21,570 for the previous window). Matching the cap to the date is the single most common consumer error.
Northern Ireland
Northern Ireland sets separate employment limits. Do not assume England & Wales figures apply to an NI contract. Our calculator’s “UK” mode follows GB guidance and surfaces an NI caveat — always verify locally if you work in Northern Ireland.
Worked intuition
A 45-year-old with 10 complete years and £1,200 weekly pay does not receive 10 × 1.5 × £1,200. The weekly cap reduces the pay figure first; only then are the weeks applied. Long service at older age bands can still hit the overall maximum.
What to do with the number
Treat the statutory figure as one line on a wider exit statement that may also include notice, holiday, and bonuses. Use our redundancy pay calculator, then confirm with the official GOV.UK calculator and a written employer breakdown.
Related guides
Official sources to keep open
Bookmark the primary official pages for your jurisdiction and re-check them whenever caps or bands change. Calculator sites (including this one) lag legislation if maintainers miss an update.
- GOV.UK — redundant employee rights
- GOV.UK — redundancy pay calculator
- Citizens Information — redundancy (Ireland)
- GOV.UK — Stamp Duty Land Tax
- Revenue.ie
Rates referenced in our tools were last verified on 14 July 2026 — re-check after each year’s Increase of Limits order.
Disclaimer
This article is general information for consumers in the UK and Ireland. It is not legal or tax advice and is not a substitute for advice on your facts. See our Disclaimer.
Scenarios worth modelling
Long service, older age bands
Workers with 15–20 complete years who spent many of those years aged 41+ often sit near the overall maximum once the weekly cap applies. Model both the week-total and the overall maximum so you understand which limit bites.
High earners above the weekly cap
If weekly pay exceeds the statutory cap, increasing salary further does not increase statutory redundancy. Negotiation value, if any, sits in enhanced policies, notice, and ex-gratia sums — not in uncapped statutory math.
Just over two years’ service
Eligibility often turns on whether two complete years exist by the relevant date. A start-date dispute of a few weeks can decide whether any statutory redundancy is due at all.
Common mistakes
- Using today’s cap for a redundancy date in a previous limits year.
- Ignoring Northern Ireland or Ireland when the contract is not GB English/Welsh/Scottish.
- Treating a calculator output as a binding legal determination.
- Forgetting notice pay, holiday, and enhanced policy lines on the settlement statement.
- Entering net pay instead of the gross weekly figure the statute expects.
- Skipping the official GOV.UK or MyWelfare cross-check before challenging HR.
When to get personal advice
Seek tailored advice if you face discrimination issues, pregnancy or disability-related redundancy selection concerns, unpaid wages, insolvency, or pressure to sign a settlement agreement quickly. Free first-line help may be available from Citizens Advice (UK) or Citizens Information (Ireland); a solicitor or union can advise on your documents.
Keep copies of your contract, handbook redundancy policy, payslips covering the reference period, and every email about the consultation process. Those documents matter more than any blog article when numbers are disputed.