Is My Redundancy Pay Capped?

The short answer

Your statutory redundancy pay is capped at £751 per week in England, Scotland, and Wales, and £783 per week in Northern Ireland — regardless of your actual weekly earnings.

This weekly cap limits the figure used in the redundancy calculation. If you earn £1,200 per week, the formula only uses £751 (or £783 in Northern Ireland) — not the full £1,200.

Use our calculator to see your specific entitlement with the cap applied automatically.

The maximum payout

Beyond the weekly cap, there is also an overall maximum total payment:

• England, Scotland, Wales: Maximum £22,530
• Northern Ireland: Maximum £23,490

These figures are based on 30 weeks' pay at the capped weekly rate. Even if your calculation produces a higher figure, the government-set ceiling means you cannot exceed these totals for statutory redundancy pay alone.

Who the weekly cap affects

The cap only matters if you earn above the weekly limit. Most people earning below £751 per week are not affected at all — their full pay is used in the calculation.

The cap typically affects people earning above average weekly earnings. If you earn below the threshold, you will receive your full actual weekly pay in the calculation.

The cap is applied to each week's pay separately within the formula — it does not reduce your total years-of-service entitlement, only the monetary value assigned to each year.

The age multiplier and how it interacts with the cap

The redundancy formula multiplies your (capped) weekly pay by a factor based on your age and years of service. Older employees get a higher multiplier per year of service:

• Under 22: 0.5 weeks' pay per year of service
• 22 to 40: 1 week's pay per year of service
• 41 and over: 1.5 weeks' pay per year of service

Because the cap reduces the weekly pay figure used, it effectively reduces the value of each year's contribution to your total — but it does not reduce the number of weeks you are entitled to. The cap limits the monetary multiplier, not the service period.

Example calculations

Below the cap — unaffected:

Employee aged 35, earns £600/week, 5 years' service: 5 × £600 = £3,000. Below cap, full pay used.

Above the cap — capped amount used:

Employee aged 45, earns £1,200/week, 10 years' service: 10 × £751 (capped) = £7,510. Without cap would be £12,000 — the cap reduces payout by £4,490.

At the maximum:

Employee aged 55, earns £2,000/week, 20 years' service: 30 weeks × £751 = £22,530 — the statutory ceiling. Further years of service cannot increase the total.

Contractual and enhanced redundancy schemes

The weekly pay cap applies only to statutory (legal minimum) redundancy pay. If your employer offers a contractual or enhanced redundancy scheme — where they pay more than the legal minimum — the cap does not apply to those additional payments.

For example, if your contract specifies 4 weeks' pay per year of service instead of the statutory formula, the excess above the statutory minimum is not subject to the statutory cap. Your employer sets their own terms for their own scheme.

Check your employment contract or staff handbook to see if an enhanced scheme applies to you.

Northern Ireland — different rates

Northern Ireland has separate redundancy legislation and slightly higher limits. If you work in Northern Ireland:

• Weekly cap: £783
• Maximum total: £23,490

Our calculator automatically applies the correct limits based on whether you select England, Scotland, Wales, or Northern Ireland.