Redundancy pay explained

Statutory redundancy pay depends on three things: your age, your full years of continuous service (capped at 20), and your weekly pay (capped at £751 for 2026/27).

You get half a week's pay for each year worked under 22, a full week for years worked at 22–40, and one-and-a-half weeks for each year at 41 or over.

Statutory redundancy pay is tax-free. More broadly, the first £30,000 of a redundancy package is tax-free — but pay in lieu of notice (PILON) is treated as earnings and is taxable.

If you think the process wasn't fair, or your settlement looks light, it's worth getting it checked before you sign anything.