Guide

How Much Statutory Redundancy Will I Get?

The statutory redundancy formula is straightforward in principle — but the age bands, weekly pay cap and service ceiling trip a lot of people up. Here is exactly how it works.

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The three inputs

Statutory redundancy pay is calculated using three pieces of information about you:

  • Your age — specifically, your age on the date you are made redundant. This determines which age band applies to each year of service.
  • Your gross weekly pay — your pay before tax and deductions, as shown on your most recent payslip. This is capped at the statutory weekly limit.
  • Your years of service — the number of complete years you have worked for the same employer. Only the first 20 years are counted.

You must have at least 2 complete years of service to qualify for statutory redundancy pay at all. Any period before your 18th birthday does not count.

The formula - step by step

The formula has three stages:

Step 1 — Cap the inputs

Two caps apply before anything else:

  • Weekly pay cap: if your weekly pay exceeds the statutory limit, the capped figure is used. In 2026 this is £751 per week (England, Scotland & Wales) or £783 per week (Northern Ireland).
  • Years of service cap: only the first 20 complete years of service are counted, regardless of how long you have actually worked there.

Step 2 — Apply age bands to each year

This is the part most people find confusing. You count each complete year of service separately, starting from the most recent year and working backwards. The multiplier applied to each year depends on how old you were during that year:

41+
1.5 weeks' pay per year — for years when you were aged 41 or older
22–40
1 week's pay per year — for years when you were aged 22–40
<22
0.5 weeks' pay per year — for years when you were under 22

You add up all the weeks from each year to get your total qualifying weeks. The maximum is 30 weeks (even if your calculation produces more).

Step 3 — Multiply and check the maximum

Multiply your total qualifying weeks by your weekly pay (capped if necessary). The result is your gross statutory redundancy pay. The maximum payout in 2026 is £22,530 (England, Scotland & Wales) or £23,490 (Northern Ireland) — derived from 30 weeks × the weekly cap.

Worked example 1 — mid-career

Emma: 38 - 6 years' service - £520/week

Emma is 38, has worked for her employer for 6 complete years, and earns £520 gross per week. She is being made redundant.

Step 1 — Check the caps

Weekly pay (£520) vs cap (£751)£520 — below cap, no reduction
Weekly pay used£520

Step 2 — Apply age bands (counting back from age 38)

Years 1–2 (ages 36–37, rate: 1 week)2 × £520 × 1.0 = £1,040
Total statutory redundancy pay£1,040

Result

Emma's total is £1,040. She qualifies since she has more than 2 years' service. The first £30,000 is tax-free, so all £1,040 is tax-free.

Worked example 2 — mixed age bands

Raj: 54 - 14 years' service - £680/week

Raj is 54, has worked for his employer for 14 complete years, and earns £680 gross per week. He is being made redundant.

Step 1 — Check the caps

Weekly pay (£680) vs cap (£751)£680 — below cap, no reduction
Weekly pay used£680

Step 2 — Apply age bands (counting back from age 54)

Years 1–14 (ages 40–53, rate: 1.5 weeks — all 14 years at 41+)14 × £680 × 1.5 = £14,280
Total statutory redundancy pay£14,280

Result

Raj's 14 years at the 1.5× rate gives him 21 qualifying weeks — all counted at the highest band since he was 41+ throughout. His full entitlement of £14,280 is within the £30,000 tax-free threshold.

Worked example 3 — varied age bands

Fiona: 29 - 8 years' service - £450/week

Fiona started work at 21. She is now 29, has been with her employer for 8 complete years, and earns £450 per week. She is being made redundant.

Step 1 — Check the caps

Weekly pay (£450) vs cap (£751)£450 — below cap, no reduction
Weekly pay used£450

Step 2 — Apply age bands (counting back from age 29)

Years 1–2 (ages 27–28, rate: 1 week)2 × £450 × 1.0 = £900
Years 3–8 (ages 21–26, rate: 0.5 weeks — started at 21, so first year at 21 counts as under-22 rate)6 × £450 × 0.5 = £1,350
Total statutory redundancy pay£2,250

Result

Fiona's younger years bring her rate down — only her most recent 2 years attract the full 1× multiplier. Her total of £2,250 is entirely within the £30,000 tax-free threshold.

Common questions

Can my employer pay me less than the statutory minimum?

No. The statutory figure is a legal floor — if you qualify (2+ years' service, genuine redundancy), your employer must pay at least this amount. They can offer more voluntarily through an enhanced scheme, but they cannot offer less.

Does overtime or bonus count as weekly pay?

Regular overtime and statutory or contractual bonus can count towards your average weekly pay, depending on what is written in your contract. Irregular or ad-hoc payments typically do not. Read our full guide on what counts as weekly pay →

I was made redundant last year — do the old rates apply?

Statutory redundancy rates are based on the rates in force on the date of your dismissal — not the date you were told about the redundancy. Rates change every April. If your dismissal date falls in a different tax year from when you were consulted, the applicable rates are those in force on the actual dismissal date.

What if I have a break in my employment?

Redundancy pay is based on continuous employment. Certain breaks — such as temporary lay-off, sickness, or statutory leave — may still count towards continuous employment. However, if you left and were re-employed by the same employer, your service may start again from the rejoin date. Check with ACAS if you are unsure.

Is statutory redundancy pay taxed?

The first £30,000 is always tax-free. Anything above that is taxable as earnings via PAYE. Most people receive less than £30,000, so their entire payout is tax-free. Read our tax guide for more detail →

Frequently Asked Questions

How is statutory redundancy pay calculated?

Statutory redundancy pay is calculated using three inputs: your age, your gross weekly pay, and the number of complete years you have worked for your employer. Each year of service is weighted by an age multiplier — the older you were during that year, the more weeks of pay it is worth.

What is the statutory redundancy formula?

The formula is: total qualifying weeks × weekly pay. The qualifying weeks come from applying age-band multipliers to each complete year of service: 0.5 weeks for years when you were under 22, 1 week for years when you were aged 22–40, and 1.5 weeks for years when you were aged 41 or older. Only the first 20 years of service are counted.

Do I need 2 years of service to qualify?

Yes. You must have at least 2 complete years of continuous employment with the same employer to qualify for statutory redundancy pay. Periods of employment before your 18th birthday do not count.

What is the maximum statutory redundancy payout?

The maximum total statutory redundancy pay is £22,530 in England, Scotland and Wales (and £23,490 in Northern Ireland) for 2026. This is derived from a maximum of 30 qualifying weeks multiplied by the weekly pay cap of £751.