Redundancy Pay UK 2026: How Much Are You Entitled To?

If you're made redundant in 2026, you may be entitled to statutory redundancy pay — a legal minimum based on your age, length of service, and weekly earnings (capped at £700). This plain-English guide explains exactly how to calculate your entitlement, what to do if your employer refuses to pay, and where to get free help from ACAS or an employment tribunal.

1. How Statutory Redundancy Pay Is Calculated (2026 Rules)

Under Section 162 of the Employment Rights Act 1996, your statutory redundancy pay is calculated using three things:

Your age at the date of redundancy
Complete years of continuous service (up to a maximum of 20 years)
Your weekly gross pay (capped at £700 per week in 2026)

The formula works like this for each full year of service:

0.5 week’s pay for each year when you were under 22
1 week’s pay for each year when you were between 22 and 40
1.5 weeks’ pay for each year when you were 41 or older

For example: if you are 45, have 10 complete years of service, and earn £600 per week, your calculation would be — 5 years under 22 (2.5 weeks) + 5 years aged 22–40 (5 weeks) = 7.5 weeks × £600 = £4,500. If you earn £800 per week, the cap of £700 applies, so the same example would give 7.5 × £700 = £5,250.

The maximum statutory payout in 2026 is therefore: 20 years × 1.5 weeks (for ages 41+) × £700 cap = £21,000.

2. Who Qualifies — and Who Doesn’t

You qualify for statutory redundancy pay if you:

Have been continuously employed by your employer for at least 2 years (starting from your first day of work)
Are an employee (not a worker or contractor) — check your employment status
Are being dismissed because your role is no longer needed (genuine redundancy)

You are not entitled if:

You are dismissed for misconduct or poor performance
You unreasonably refuse a suitable alternative job offer from your employer
You work in certain excluded sectors (e.g., some Crown employees, police, armed forces) — though most private and public sector employees are covered
You are an agency worker or freelancer without an employment contract

Scotland and Northern Ireland note: The same statutory rules apply across the UK, but in Northern Ireland, claims go to the Industrial Tribunals and Fair Employment Tribunal, and in Scotland, the Employment Tribunal (Scotland) handles cases. The calculation is identical.

3. What to Do If Your Employer Refuses to Pay

If you believe you are entitled to redundancy pay but your employer hasn’t paid, or has underpaid, follow these steps:

Step 1 — Raise a formal grievance: Write to your employer explaining why you believe you are entitled, referencing the Employment Rights Act 1996. Keep a copy.
Step 2 — Contact ACAS: The Advisory, Conciliation and Arbitration Service (ACAS) offers free early conciliation. Call 0300 123 1100 or use their online form. This is a mandatory step before any tribunal claim.
Step 3 — Employment tribunal claim: If conciliation fails, you can make a claim to an employment tribunal. You must do this within 3 months minus 1 day from the date your employment ended. Use the ET1 form online.
Step 4 — Money Claim Online (MCOL): If the amount is under £100,000 and it’s a straightforward debt (e.g., they agree you’re owed but haven’t paid), you can use MCOL to get a County Court Judgment (CCJ). However, for redundancy disputes, a tribunal is usually better because it can also award compensation for unfair dismissal.

If your employer becomes insolvent, you can apply to the Redundancy Payments Service (RPS) for payment from the National Insurance Fund. The RPS will pay statutory redundancy and some arrears, up to the statutory limits.

4. Enhanced (Contractual) Redundancy Pay

Many employers offer enhanced redundancy pay — above the statutory minimum. This is often written into your employment contract, staff handbook, or collective agreement. If your employer has a contractual redundancy scheme, they must follow it. If they fail to pay what’s promised, you can sue for breach of contract in the county court or tribunal (for claims up to £25,000).

Check your contract carefully. Some schemes use a multiplier of 2 or 3 weeks’ pay per year of service, or remove the weekly cap. If you’re unsure, ask ACAS or a solicitor to review your contract.

Frequently Asked Questions

How is statutory redundancy pay calculated in the UK for 2026?

For 2026, statutory redundancy pay is calculated using your age, complete years of continuous service, and your weekly gross pay (capped at £700). You get: 0.5 week’s pay for each full year of service when you were under 22; 1 week’s pay for each full year between ages 22 and 40; 1.5 weeks’ pay for each full year when you were 41 or older. Total service is capped at 20 years.

What is the weekly pay cap for redundancy in 2026?

In 2026, the statutory cap on a week’s pay is £700. This means even if you earn more than £700 per week, your redundancy calculation will use £700 as the maximum.

How many years of service can I claim for redundancy?

You can claim for a maximum of 20 complete years of continuous service. Any service beyond 20 years does not count towards statutory redundancy pay.

What can I do if my employer refuses to pay redundancy?

First, raise a formal grievance in writing. If unresolved, you can refer the matter to ACAS for early conciliation. If that fails, you can make a claim to an employment tribunal (usually within 3 months minus 1 day from the date of dismissal). You may also use the Money Claim Online (MCOL) for debts under £100,000.

Does the redundancy pay differ in Scotland or Northern Ireland?

Statutory redundancy pay is identical across England, Wales, Scotland, and Northern Ireland because the Employment Rights Act 1996 applies throughout the UK. However, tribunal procedures differ slightly: in Scotland, claims go to the Employment Tribunal (Scotland), and in NI, the Industrial Tribunals and Fair Employment Tribunal handle claims. The core calculation remains the same.

References & Useful Links

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