Redundancy Pay Rights in the UK Explained

This guide explains UK statutory redundancy pay in plain English so you understand who qualifies, how it is calculated, what changes between Great Britain and Northern Ireland, and how it interacts with notice pay and tax.

Who can usually get statutory redundancy pay

You can usually claim statutory redundancy pay if all of the following apply at the relevant date:

• you are an employee (not a worker, agency staff or genuinely self-employed)
• you have at least 2 years' continuous service with the same employer
• you have been dismissed because of redundancy (the role is no longer needed, not misconduct or capability)
• you have not unreasonably refused suitable alternative employment

Who might not qualify

• workers, agency workers and many casual or zero-hours roles where employment status is not clearly 'employee'
• employees with under 2 years' continuous service at the relevant date
• those dismissed for misconduct or capability, not redundancy
• certain excluded categories (police, armed forces, crown servants, some domestic servants who are immediate family members of the employer)

Employment status is fact-specific. Many people who think they are 'self-employed' or 'casual' are actually employees in law — get advice if unsure.

How statutory redundancy pay is calculated

For each full year of continuous service counted backward from the relevant date (capped at 20 years), apply the age-banded multiplier:

• 0.5 week's pay for each full year you were under 22
• 1 week's pay for each full year you were 22 to 40
• 1.5 weeks' pay for each full year you were 41 or older

Weekly pay used in the formula is capped:

• Great Britain — £751 from 6 April 2026 · max statutory pay £22,530
• Northern Ireland — £783 from 6 April 2026 · max statutory pay £23,490

The relevant date explained

The 'relevant date' is the date used to calculate years of service. In normal cases it is the actual leaving date. Where payment in lieu of notice (PILON) applies, the relevant date can be pushed by the statutory notice period (1 week per full year of service, up to 12 weeks). This can sometimes push you over another full year of service and increase the payout.

Notice pay vs redundancy pay

Notice pay is separate from statutory redundancy pay and is normally taxable. Statutory minimum notice is:

• at least 1 week if employed between 1 month and 2 years
• 1 week per full year between 2 and 12 years
• 12 weeks if employed for 12 years or more

If your contract gives you longer notice, your contract wins. Notice pay uses your actual weekly pay — it is not capped at the statutory weekly cap.

Great Britain vs Northern Ireland

The formula and age bands are the same. The weekly pay cap and maximum statutory payment differ — currently £751 / £22,530 in Great Britain and £783 / £23,490 in Northern Ireland from 6 April 2026. Pick your region in the calculator to apply the right caps.

Worked examples

1. Worker aged 51 with 15 years' service, £600 gross weekly pay (Great Britain): 4 years aged 22–40 (= 4.0 weeks) + 11 years aged 41+ (= 16.5 weeks) = 20.5 weeks. Capped pay = £600 (under £751 cap). Statutory redundancy pay = 20.5 × £600 = £12,300.

2. Worker aged 30 with 5 years' service, £500 gross weekly pay (Great Britain): 5 years aged 22–40 (= 5.0 weeks). Capped pay = £500. Statutory redundancy pay = 5 × £500 = £2,500.

3. Worker aged 45 with 12 years' service near an anniversary, £900 gross weekly pay (Great Britain), with PILON: Without PILON, service might be 11 full years; with PILON the relevant date is pushed by 12 weeks of statutory notice, possibly making it 12 full years. 12 years × 1.5 = 18 weeks. Capped pay = £751 (above the £751 cap). Statutory pay = 18 × £751 = £13,518.

Tax and National Insurance

Statutory redundancy pay up to £30,000 is generally tax-free and not subject to National Insurance. Notice pay, holiday pay, unpaid wages, contractual bonuses and most enhanced redundancy elements may be taxed differently. This guide is not tax advice — for complex cases or large enhanced packages, check GOV.UK or speak to a tax specialist.

Suitable alternative employment

If your employer offers another role and you unreasonably refuse it, you can lose your statutory redundancy pay. There is usually a 4-week trial period to try the new role without losing your entitlement. Whether an offer is 'suitable' and a refusal 'unreasonable' depends on pay, hours, location, status and your personal circumstances.

Collective redundancy and consultation

Where 20 or more redundancies are proposed at one establishment within 90 days, collective consultation rules apply. Minimum consultation periods are 30 days (20–99 redundancies) and 45 days (100+). These are content rules, not part of the individual statutory pay formula.

Try the calculator

Use our UK Redundancy Pay Calculator for an eligibility check, statutory estimate, age-banded breakdown, separate notice pay panel and tax note.

Sources

• GOV.UK — Redundancy: your rights — https://www.gov.uk/redundancy-your-rights
• GOV.UK — Calculate your statutory redundancy pay — https://www.gov.uk/calculate-your-redundancy-pay
• GOV.UK — Notice periods — https://www.gov.uk/handing-in-your-notice/giving-notice
• GOV.UK — Tax on termination payments — https://www.gov.uk/income-tax-on-payments-from-employer
• Acas — Redundancy pay — https://www.acas.org.uk/redundancy-pay
• Acas — Suitable alternative employment — https://www.acas.org.uk/suitable-alternative-employment-and-trial-periods
• nidirect — Redundancy pay (Northern Ireland) — https://www.nidirect.gov.uk/articles/redundancy-pay

Last reviewed: April 2026. This guide explains current statutory redundancy rules and is not legal advice. For complex cases, contact Acas, Citizens Advice, or a qualified employment law adviser.