Question 1

How is statutory redundancy pay calculated?

Accepted Answer

For each full year of service you get half a week’s pay for years worked under 22, one week for years worked between 22 and 40, and one and a half weeks for years worked at 41 or over. Only the last 20 years count, and a week’s pay is capped at £751 from 6 April 2026, giving a maximum of £22,530.

Question 2

Do I qualify for statutory redundancy pay?

Accepted Answer

You need at least two years of continuous service with the employer and to be an employee. Agency workers, the genuinely self-employed and most contractors do not qualify. If you unreasonably turn down a suitable alternative job, you can lose the entitlement.

Question 3

Is redundancy pay taxed?

Accepted Answer

The first £30,000 of a genuine redundancy payment is free of income tax and National Insurance. Anything above £30,000 is taxed as income. Statutory redundancy pay alone never reaches £30,000, so it is always tax-free — but an enhanced package or payment in lieu of notice can push you over.

Question 4

What is a week’s pay?

Accepted Answer

Your normal gross weekly pay before tax, including regular contractual overtime and typically averaged over the 12 weeks before the redundancy notice if your hours vary. For the statutory calculation it is capped at £751 a week, so higher earners are limited by the cap.

Question 5

Can my employer pay more than the statutory amount?

Accepted Answer

Yes, and many do. Contractual or enhanced redundancy schemes often use uncapped actual pay, a higher multiplier, or both. Statutory redundancy pay is the legal minimum, not a maximum.

Age during service	Years	Rate	Weeks
Aged 41 and over	4	1.5× a week	6
Aged 22 to 40	8	1× a week	8

Redundancy pay calculator

How the weeks add up

Tax treatment

How statutory redundancy pay works

Redundancy pay questions

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