Key facts (2026): Statutory Redundancy Pay in 2026 is calculated based on your age, length of service, and weekly pay (capped at £643/week). You qualify if you have worked for your employer for at least 2 continuous years. Maximum statutory redundancy pay is £19,290. Payments are tax-free up to £30,000.
Redundancy is one of the most stressful employment situations a UK worker can face. Understanding your rights — including your minimum statutory entitlement, the notice period you are owed, and what happens to your annual leave — helps you protect your financial position at a difficult time.
Statutory Redundancy Pay Calculation
The calculation uses: half a week's pay for each complete year of service under age 22; one week's pay for each complete year aged 22–40; one and a half weeks' pay for each complete year aged 41 and over. Weekly pay is capped at £643 for redundancies from April 2026. Maximum service counted: 20 years. Example: aged 45, earning £800/week (capped at £643), 10 years' service: (1.5 × 643 × 10) = £9,645 statutory redundancy pay.
Notice Pay and Annual Leave
In addition to redundancy pay, you are also entitled to your full statutory notice period (or contractual notice if longer): under 1 month service: no statutory notice; 1 month–2 years: 1 week; 2–12 years: 1 week per year of service; 12+ years: 12 weeks maximum. You are also entitled to payment for any accrued but untaken annual leave. If you are put on gardening leave during your notice period, you continue to receive full pay.
How to Claim Redundancy Pay
Your employer should calculate and pay your redundancy pay automatically as part of the redundancy process. If your employer refuses to pay, is insolvent, or disputes the amount: use the Redundancy Payment Service at gov.uk/claim-redundancy or contact ACAS. If your employer is insolvent, the government's Redundancy Payments Service pays the statutory minimum from the National Insurance Fund. Claims must be made within 6 months of the date of redundancy.
Our Verdict
Know your numbers before any redundancy conversation with your employer. Calculate your statutory entitlement using HMRC's redundancy calculator at gov.uk/calculate-your-redundancy-pay. Many employers offer enhanced redundancy above the statutory minimum — particularly for long-serving employees — and this is negotiable. Any payment up to £30,000 is tax-free, which has significant tax planning implications for larger packages.
Frequently Asked Questions
How much redundancy pay am I entitled to UK?
Statutory redundancy pay: half to 1.5 weeks' pay per year of service depending on age, capped at £643/week, maximum 20 years. Tax-free up to £30,000.
How long do I need to work before I get redundancy pay?
2 continuous years of service with the same employer.
What if my employer refuses to pay redundancy?
Contact ACAS or the Redundancy Payment Service at gov.uk. If the employer is insolvent, the government pays statutory redundancy from the National Insurance Fund.
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Disclaimer: For informational purposes only. Verify with official sources before making decisions.
Last updated: April 2026 · Author: Chandraketu Tripathi
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