How redundancy pay works: what you're entitled to in the UK
If you're made redundant after at least two years with your employer, you're legally entitled to statutory redundancy pay. Many employers pay more, but they can't pay less.
Who gets statutory redundancy pay?
You qualify if you're an employee (not a worker or self-employed), you've worked for your employer continuously for two years or more, and your job has genuinely gone. You can lose the right if you unreasonably turn down suitable alternative work your employer offers you.
How redundancy pay is calculated
Statutory redundancy pay depends on your age, length of service and weekly pay. For each full year of service you get half a week's pay for years worked under age 22, one week's pay for years worked aged 22 to 40, and one and a half weeks' pay for years worked aged 41 and over.
Only the last 20 years count, and weekly pay is capped at £751 for redundancies from April 2026. That makes the most anyone can get in statutory redundancy pay £22,530.
Example: someone aged 45 with 10 years' service on £650 a week gets 5 years at 1.5 weeks and 5 years at 1 week, which is 12.5 weeks, or £8,125.
Enhanced and contractual redundancy pay
Your contract or staff handbook may promise enhanced redundancy pay, often a set number of weeks per year without the weekly cap. If it does, you get whichever is higher. Settlement agreements often include extra payments too, and you're entitled to independent legal advice before signing one, usually paid for by your employer.
When you should be paid
Redundancy pay is normally paid on or soon after your last day. If your employer refuses or goes bust, you can claim from the government's Redundancy Payments Service.