Statutory Redundancy Pay
If an employee is made redundant they may be entitled to a statutory redundancy payment. The current entitlement is detailed below:
A week's pay for the purposes of calculating redundancy is capped at £538.00 as of 6th April 2020 (previously £525.00 per week).
To calculate the number of week's pay due, you should use the following amounts:
- 0.5 week's pay for each full year of service where age during year less than 22
- 1.0 week's pay for each full year of service where age during year is 22 or above, but less than 41
- 1.5 week's pay for each full year of service where age during year is 41+
The maximum amount is £16,140.00 as of 6th April 2020 (previously £15,750.00).
Tip - Check the current rate on the Government website and use the Government Ready Reckoner to work out the number of weeks pay.
Note: In addition to statutory redundancy pay an employee will be entitled to notice pay (see notice), although they may work their notice period.
Note: A Company may have an enhanced redundancy payment scheme that pays in excess of statutory redundancy.