Redundancy pay calculator
The statutory minimum you are owed, and how each year of service was counted towards it.
- Years at 41 or over, 1.5 weeks each
- 0
- Years from 22 to 40, 1 week each
- 0
- Years under 22, half a week each
- 0
- Weekly pay used
- £0
- Total
- £0
How the weeks are counted
Statutory redundancy pay is a number of weeks' pay, and the number depends on how old you were during each year you worked, not on your age when you leave. Working backwards from your last day:
- each year worked at 41 or over earns a week and a half
- each year worked from 22 to 40 earns one week
- each year worked under 22 earns half a week
Only complete years count, and only the last 20. Someone leaving at 45 after ten years was 41 or over for four of them, so they earn six weeks for those and six for the rest: twelve weeks in total, not fifteen.
Two caps that catch people out
Weekly pay is capped at £751 for this calculation, whatever you actually earn. Someone on £1,500 a week is treated exactly like someone on £751. With service capped at 20 years, the statutory maximum anyone can receive is £22,530, and reaching it takes twenty years all worked at 41 or over.
This is the floor, not the offer. Plenty of contracts promise enhanced redundancy, often a month's pay per year of service with no cap, and that promise is enforceable. Read your contract or staff handbook before accepting a figure.
What you receive is tax free
Genuine redundancy payments are free of income tax and National Insurance up to £30,000, so statutory redundancy pay always arrives whole. Be careful reading a settlement offer though: pay in lieu of notice, accrued holiday and any bonus are taxed normally, so a headline total can shrink noticeably once those parts are taxed.
What this does not cover
Notice pay, holiday accrued but not taken, enhanced contractual redundancy, and anything offered under a settlement agreement. It also assumes a genuine redundancy: if you believe the dismissal was not really a redundancy, that is an unfair dismissal question with a three month time limit, and worth taking advice on quickly.
Common questions
- Is statutory redundancy pay taxed?
- No. Redundancy payments are tax free up to £30,000, and statutory redundancy pay is well under that ceiling. Pay in lieu of notice and holiday pay are taxed normally, so a settlement can be part taxable and part not.
- Why does my age change the amount?
- The multiplier depends on how old you were during each year of service, not your age when you leave. Years worked at 41 or over earn a week and a half each, years from 22 to 40 earn one week, and years under 22 earn half a week.
- My weekly pay is higher than the cap. Do I lose out?
- Yes, for the statutory calculation. Weekly pay is capped at £751 however much you earn, which is why the statutory maximum is £22,530. Many contracts promise enhanced redundancy above the statutory floor, so check yours.
- Do I qualify with less than two years service?
- Not for statutory redundancy pay, which needs two full years. You may still be entitled to notice pay, accrued holiday, and anything your contract promises.
- Does this cover a settlement agreement?
- No. This is the statutory minimum only. A settlement agreement usually offers more in exchange for waiving your right to claim, and the first £30,000 of a genuine redundancy payment is tax free. Take advice before signing one.