Statutory Redundancy Pay Calculator
Calculate UK statutory redundancy pay entitlement. Based on age, length of service, and weekly pay using current UK rates.
Current age at time of redundancy
Minimum 2 years required. Maximum 20 years counted.
Gross weekly pay before tax. Capped at £719/week for statutory calculation.
Enter employee details to calculate redundancy pay
How UK Redundancy Pay Works
Who Qualifies for Statutory Redundancy Pay
To qualify for statutory redundancy pay in the UK, an employee must have worked continuously for their employer for at least 2 years. The role must be genuinely redundant — meaning the employer needs fewer workers for the type of work the employee does, the business is closing, or the workplace is relocating. Employees who are dismissed for misconduct or who unreasonably refuse a suitable alternative role may lose their entitlement.
How the Calculation Works
Statutory redundancy pay is calculated based on the employee's age, length of service, and weekly pay. For each complete year of service, employees receive: half a week's pay for each year under age 22, one week's pay for each year between ages 22 and 40, and one and a half weeks' pay for each year aged 41 or over. Service is capped at 20 years, and weekly pay is capped at £719 for the 2025/26 tax year.
Weekly Pay Cap
The weekly pay used in the calculation is capped at £719 (2025/26 rate). This cap is updated each year by the government. If an employee earns more than the cap, only the capped amount is used for the statutory calculation. Many employers choose to offer enhanced redundancy packages that use actual weekly pay without the cap, but this is at their discretion.
Tax on Redundancy Pay
Statutory redundancy pay is tax-free up to £30,000. Any amount above this threshold — including enhanced redundancy payments — is subject to income tax and may also be subject to National Insurance contributions. This £30,000 exemption covers the total redundancy payment, not just the statutory element.
Notice Period and Redundancy
Redundancy pay is separate from notice pay. Employees are still entitled to their statutory or contractual notice period (whichever is longer) in addition to redundancy pay. During the notice period, employees continue to receive their normal pay. Employers can choose to make a payment in lieu of notice (PILON) instead of having the employee work their notice.
Redundancy Pay FAQ
Is statutory redundancy pay the same as my contractual entitlement?
Not necessarily. Statutory redundancy pay is the legal minimum. Many employers offer enhanced redundancy packages that may use actual weekly pay (without the cap) or offer more weeks per year of service. Check your employment contract or company policy for enhanced terms.
Do I have to pay tax on my redundancy pay?
The first £30,000 of redundancy pay is tax-free. This applies to both statutory and enhanced redundancy payments combined. Any amount above £30,000 is subject to income tax. Your employer will deduct any tax due through payroll.
Can I get redundancy pay if I work part-time?
Yes. Part-time employees have the same right to statutory redundancy pay as full-time employees. The calculation is based on your actual weekly pay (or capped amount), not a full-time equivalent. All that matters is that you have at least 2 years of continuous service.
What counts as a "week's pay" for the calculation?
For employees with fixed hours and pay, a week's pay is the gross weekly wage. For employees with variable hours or commission-based pay, it is calculated as the average weekly pay over the 12 weeks before the redundancy notice was given. The maximum weekly pay used in the calculation is capped at £719 (2025/26).
Related HR Terms
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