Calculate your statutory redundancy pay entitlement based on your age, weekly pay and length of service. The weekly pay cap for 2025/26 is £700.
Note: The first £30,000 of total redundancy pay (statutory + any enhanced) is tax-free. National Insurance is never charged on redundancy pay. For a more detailed calculation, visit our full Redundancy Pay Calculator.
Redundancy is a specific legal reason for dismissal and occurs when an employer needs to reduce the number of employees because:
Even a genuine redundancy situation can result in unfair dismissal if the employer does not follow a fair process. Both the reason AND the process must be fair.
| Age at Time of Redundancy | Redundancy Pay Rate |
|---|---|
| Under 22 | 0.5 weeks' pay per year of service |
| 22 to 40 | 1 week's pay per year of service |
| 41 and over | 1.5 weeks' pay per year of service |
£700 per week (2025/26). If you earn more than £700/week, only £700 counts for the calculation.
Maximum 20 years of service counts, even if you have worked longer.
You need at least 2 years' continuous service to qualify for statutory redundancy pay.
Maximum statutory redundancy pay is £21,000 (20 years × 1.5 × £700).
Many employers offer enhanced redundancy pay above the statutory minimum. Enhanced pay might use your full actual salary (no cap), a higher multiplier, or additional years. Anything above the statutory amount is discretionary unless written into your contract.
Employers must consult with employees before finalising redundancies. The required consultation depends on the number of redundancies:
| Number of Redundancies (at one establishment) | Minimum Consultation Period |
|---|---|
| 1 to 19 employees | No minimum period — but reasonable individual consultation required |
| 20 to 99 employees | At least 30 days before first dismissal |
| 100 or more employees | At least 45 days before first dismissal |
Employers must use objective, fair criteria to select who is made redundant. Commonly accepted criteria include:
Selecting an employee for redundancy for any of the following reasons is automatically unfair dismissal, with no qualifying service period required:
When made redundant, you are entitled to your notice period as well as redundancy pay. These are separate entitlements.
| Length of Service | Statutory Minimum Notice |
|---|---|
| Less than 1 month | None (but check your contract) |
| 1 month – 2 years | 1 week |
| 2 – 12 years | 1 week per year of service |
| 12 years or more | 12 weeks (maximum) |
Your contract may provide longer notice than the statutory minimum. You are entitled to the greater of your contractual notice and statutory minimum notice.
During the notice period, employees with at least 2 years' service have a statutory right to reasonable paid time off (up to 40% of one week's pay) to look for a new job or arrange training. This right exists even if the employer gives longer notice than the statutory minimum.
Your employer may pay you PILON instead of requiring you to work your notice period. Since April 2018, all PILON payments are subject to income tax and National Insurance, regardless of whether your contract contains a PILON clause.
PILON must equal the pay (including contractual benefits) you would have received during the notice period. If your employer underpays PILON, you can bring a breach of contract claim.
Alternatively, your employer may place you on garden leave during the notice period. You are still employed, receiving full pay and benefits, but not required — and often not permitted — to attend the workplace. During garden leave:
Amounts above £30,000 are subject to income tax at your marginal rate (20%, 40% or 45% depending on your total income for the year). National Insurance is never charged on redundancy pay, whether below or above £30,000.
Pregnant employees and those on or returning from maternity leave have significantly enhanced redundancy protections that go beyond ordinary employment rights:
An employer facing the need to reduce headcount may invite applications for voluntary redundancy before proceeding to compulsory selection. Voluntary redundancy typically offers enhanced terms to attract volunteers. Key points:
If insufficient volunteers come forward, or the employer does not offer voluntary redundancy, the employer selects employees compulsorily using a fair process. The process must include a selection pool, objective criteria, individual consultation and consideration of suitable alternative roles.
If you believe your redundancy was unfair — because the process was flawed, the selection was discriminatory, or the redundancy was not genuine — you can bring an Employment Tribunal claim.
Your time limit of 3 months minus 1 day starts from the date your employment ends.
Before submitting a Tribunal claim, you must notify ACAS. This pauses the time limit. ACAS may broker a settlement (often quicker and cheaper than a full hearing).
If conciliation fails, submit your ET1 form online. For unfair dismissal, you typically need 2 years' continuous service (exceptions apply).
The Tribunal considers evidence from both parties. If successful, remedies include reinstatement or compensation (basic award + compensatory award, capped at £115,115 or 52 weeks' pay).
Legal representation is not required at an Employment Tribunal, but many claimants use solicitors or trade union representatives. Free advice is available from ACAS, Citizens Advice and law clinics.
Statutory redundancy pay is calculated using age and length of service: 0.5 weeks' pay per year of service for years worked under age 22; 1 week's pay per year for ages 22-40; and 1.5 weeks' pay per year for years worked aged 41 or over. Weekly pay is capped at £700 for 2025/26. Only the last 20 years of service count. The maximum statutory redundancy pay is therefore £700 × 1.5 × 20 = £21,000. Use the calculator above to find your specific entitlement.
For fewer than 20 redundancies at a single establishment, there is no statutory minimum collective consultation period, but the employer must still conduct meaningful individual consultation. For 20-99 redundancies, minimum 30 days' collective consultation is required before the first dismissal can take effect. For 100 or more redundancies, the minimum is 45 days. These are floor requirements — employers should begin consultation as early as possible and should always consult individually as well as collectively.
The first £30,000 of redundancy pay (combining statutory and any enhanced payment) is completely tax-free and free of National Insurance. Amounts above £30,000 are subject to income tax at your marginal rate. National Insurance is never charged on any redundancy pay. Note that PILON (Payment In Lieu of Notice) is fully taxable as employment income since April 2018, and is therefore separate from the £30,000 exemption calculation.
PILON — Payment In Lieu of Notice — is a payment your employer makes instead of requiring you to work your notice period. It must equal the pay and benefits you would have received had you worked that period. Since April 2018, all PILON is subject to income tax and NI, regardless of whether your contract contained a PILON clause. It does not reduce your redundancy pay entitlement and is entirely separate from the statutory redundancy calculation.
Selecting you for redundancy because of your pregnancy or maternity leave is automatically unfair dismissal and potentially pregnancy discrimination — both claims that can be brought from day one of employment. If your role is genuinely redundant while you are on maternity leave, your employer must offer you any suitable alternative vacancy before other employees. Since April 2024, this enhanced protection applies from the date pregnancy is notified until 18 months after the birth.
A fair process involves: establishing a rationally defined selection pool; agreeing objective scoring criteria (skills, qualifications, performance, attendance, disciplinary record); scoring each employee against the criteria; individually consulting with each affected employee about their scores and any mitigating factors; and considering suitable alternative roles. LIFO (last in first out) used alone is risky as it can be age-discriminatory and does not identify the best workers for the business's future needs.
Statutory minimum notice is 1 week per year of service (capped at 12 weeks). You are entitled to the greater of your statutory minimum or contractual notice. During the notice period you receive full pay and benefits. If you have 2+ years' service, you also have the right to reasonable paid time off (up to 40% of a week's pay per week) to look for a new job or arrange training.
Contact ACAS for free advice and begin the mandatory early conciliation process. If unresolved, submit an ET1 claim to the Employment Tribunal within 3 months minus 1 day of your dismissal date (the ACAS early conciliation process pauses this clock). For unfair dismissal you generally need 2 years' service, but some claims (pregnancy, whistleblowing, trade union membership) have no qualifying period. Remedies include reinstatement, re-engagement or compensation.
Garden leave means your employer keeps you on full pay and benefits during your notice period but does not require — and may prohibit — you from attending work or engaging with clients or colleagues. You remain a full employee during garden leave, so your obligations (confidentiality, not joining a competitor during the period) continue. Holiday accrues during garden leave. You cannot be forced onto garden leave unless your contract provides for it or you agree to it.
In voluntary redundancy, the employer invites employees to put themselves forward for redundancy — often with enhanced pay to attract volunteers. The employer does not have to accept all volunteers, and you cannot be forced to volunteer. In compulsory redundancy, the employer selects employees using a fair process. Your statutory rights (redundancy pay, notice, consultation, time off to seek work) are the same whether redundancy is voluntary or compulsory.