UK Statutory Redundancy Pay Explained (2025/26)

If you are made redundant in the UK, you may be owed statutory redundancy pay: a legal minimum set by your age, how long you have worked for the employer, and your weekly pay. This guide covers who qualifies, the age-banded formula, the two caps that limit the total, the 21,570 GBP statutory maximum for 2025/26, how the payment is taxed, and a full worked example.

Who qualifies

You usually qualify for statutory redundancy pay if you are an employee with at least 2 years of continuous service and you are made redundant, meaning your job is no longer needed. Below 2 years of service there is no statutory redundancy pay, although your contract may still provide something. The figures here are the legal minimum; many employers offer an enhanced package that pays more.

The age-banded formula

Statutory redundancy pay is counted in weeks of pay, and the number of weeks depends on your age during each full year you worked. For every full year of service you get:

• 0.5 a week's pay for each full year worked while under 22
• 1 week's pay for each full year worked while aged 22 to 40
• 1.5 weeks' pay for each full year worked while aged 41 or over

Because the band depends on your age in each year, the calculation counts back from your most recent year of service and assigns the right rate to each year based on how old you were then.

The two caps and the statutory maximum

Two caps limit the total. First, length of service is capped at 20 years, so years beyond the most recent 20 do not count. Second, a week's pay is capped at 719 GBP from 6 April 2025, so if you earn more than that, the calculation still uses 719 GBP. The most weeks anyone can reach is 30 (20 years all at the 1.5-week rate), which at the 719 GBP cap gives a statutory maximum of 21,570 GBP.

Worked example: age 45, 10 years, 600 GBP a week

Take someone aged 45 with 10 full years of service on a gross weekly pay of 600 GBP. Counting back, the four years worked while aged 41 or over each count 1.5 weeks (4 x 1.5 = 6 weeks), and the six earlier years, worked while aged 35 to 40, each count 1 week (6 x 1 = 6 weeks). That is 12 weeks of pay. Weekly pay of 600 GBP is below the 719 GBP cap, so the total is 12 x 600 = 7,200 GBP.