Statutory redundancy pay 2026/27.
Employees with two years’ service who are made redundant are owed statutory redundancy pay, by their age and years worked. From 6 April 2026, a week’s pay counts for at most £751, so the most it can be is £22,530. Here is how the rules work.
Redundancy pay, 2026/27
What the law sets
£751
A week’s pay, max
£22,530
The most it can be
20 years
Counted, at most
- Each year under 22 Half a week’s pay 0.5 weeks
- Each year from 22 to 40 A week’s pay 1 week
- Each year from 41 A week and a half’s pay 1.5 weeks
- Written statement The amount and how it was worked out Required
Who gets it
Statutory redundancy pay is owed to someone who:
- is an employee, working under a contract of employment;
- has at least 2 years’ continuous service with you;
- has been dismissed, laid off or put on short-time working.
Some people don’t get it. Dismissal for misconduct is not redundancy. Someone who refuses suitable alternative work without good reason can lose the right to it, and so can someone who chose early retirement. Crown servants, the armed forces and the police are left out, as are some apprentices and domestic servants.
How it is worked out
Section 162 of the Employment Rights Act 1996 counts back from the date the employment ends, a full year at a time. Each year earns an amount by the person’s age in it:
- Half a week’s pay for each full year they were under 22.
- A week’s pay for each full year they were 22 or older, but under 41.
- A week and a half’s pay for each full year they were 41 or older.
Only 20 years count. Once they have been counted back from the end, any earlier years are left out.
Our free redundancy pay calculator does the counting for one person from their date of birth, start date, leaving date and pay, and shows each step.
A week’s pay, and the cap
GOV.UK says a week’s pay is the average they earned each week over the 12 weeks before the day they were given notice of redundancy. For someone who was on furlough, it is what they would normally have earned.
For redundancies on or after 6 April 2026, a week’s pay counts for no more than £751, however much they earn. With 20 years counted at a week and a half each, the most statutory redundancy pay can be is £22,530. For a redundancy before 6 April 2026, both figures are lower.
Rates may differ in Northern Ireland.
Paying it
- When: you must pay it when you dismiss the employee, or soon after.
- A written statement: a redundant employee has the right to one showing the amount and how you worked it out.
- If it isn’t paid: an employee has 6 months from the date their job ends to claim it, at an employment tribunal.
- If you can’t afford it: where paying statutory redundancy pay would make the business insolvent, the Insolvency Service’s Redundancy Payments Service may help, and the money is then a debt to repay.
Making 20 or more people redundant at one place within 90 days brings a duty to consult first. Our collective redundancy guide explains it.
Paying more, and other pay
Statutory redundancy pay is the minimum. You can pay more, and you can offer redundancy pay to staff with less than 2 years’ service.
It is separate from the other pay owed when someone leaves: their notice, or pay in place of it, and any holiday they have built up and not taken. Our notice period calculator and holiday entitlement calculator cover those.
Sources
- Employment Rights Act 1996, section 162 (the amount, by age, and the 20 years counted)
- Redundancy: your rights, redundancy pay (GOV.UK)
- Making staff redundant: redundancy pay (GOV.UK)
This guide is general information, not legal advice. For one person’s situation, ask Acas (0300 123 1100, free) or a solicitor.
Redundancy handled with the paperwork in one place.
KivoHR records the reason, works out the notice owed and the holiday to settle, and warns you when collective consultation applies.