In today’s volatile job market, employees may face the unfortunate reality of redundancy. Redundancy occurs when an employer no longer requires a particular role, or when a business is downsizing. During such times, it’s essential for workers to know their rights, and one key aspect of that is statutory redundancy pay. This article will explore what statutory redundancy pay is, how it is calculated, and who is eligible to receive it, with a focus on how EmploymentLawUK can support you in these situations.

What is Statutory Redundancy Pay?

Statutory redundancy pay is a legal entitlement given to employees who are dismissed due to redundancy. Unlike other forms of dismissal, redundancy occurs when an employer can no longer provide work for an employee. This pay ensures that workers receive financial support during their transition out of the company, and it is meant to help cushion the impact of losing a job through no fault of their own.

Who is Eligible for Statutory Redundancy Pay?

Not every employee is automatically entitled to statutory redundancy pay. To qualify, the following criteria must be met:

1. Minimum Service Requirement: Employees must have worked for their employer for at least two continuous years.
2. Age and Salary Considerations: The amount of redundancy pay is based on the employee’s age and salary, and the number of years worked for the employer.
3. Dismissal Due to Redundancy: The employee must be made redundant—not dismissed for other reasons like misconduct or performance issues.

Key Eligibility Factors

• Age: Employees aged 22 or over receive a higher rate of redundancy pay than younger workers.
• Length of Service: The longer an employee has worked for their employer, the higher the redundancy pay. Service years are grouped into bands (1) up to 22 years old, (2) between 22 and 41, and (3) 41 years and over. Each age group is entitled to a different amount of redundancy pay for each year of service.
• Weekly Pay: The statutory redundancy pay is based on a weekly wage capped at £643 (as of 2025). If the employee’s weekly salary exceeds this amount, only £643 is considered for redundancy pay calculation.

How is Statutory Redundancy Pay Calculated?

Statutory redundancy pay is calculated using a formula based on the employee’s age, salary, and years of service. Here’s a quick breakdown of how it works:

• Up to 22 years old: 0.5 week’s pay for each full year worked.
• Between 22 and 41 years old: 1 week’s pay for each full year worked.
• 41 years and over: 1.5 week’s pay for each full year worked.

The pay is capped, and the maximum weekly earnings used in the calculation are currently £643. For example, if an employee who is 45 years old with 10 years of service is being made redundant, they would receive 0.5 week’s pay for each year worked up to the age of 22, one week’s pay for each year between 22 and 41, and 1.5 weeks of pay for each year after 41.

What Are the Rights of Employees Regarding Redundancy?

Employees have the right to:

1. Consultation: Employers must inform and consult with employees about redundancies.
2. Selection Criteria: Redundancies should not be based on discrimination but rather on objective criteria such as skills and experience.
3. Alternative Employment: Employers must offer suitable alternative roles where available.
4. Redundancy Payment: As mentioned, statutory redundancy pay is available to eligible employees. However, employers may offer more than the statutory minimum.

How EmploymentLawUK Can Help

If you find yourself facing redundancy, EmploymentLawUK can provide the guidance you need to ensure that you understand your rights and that you receive everything you’re entitled to. The clinic’s commitment to free advice ensures that employees aren’t left to navigate employment law alone.

Free Advice and Templates

EmploymentLawUK offers templates that can help you understand how to approach your redundancy situation. Whether you need help with drafting a letter to your employer or understanding the legal implications of your redundancy, the clinic is there to guide you every step of the way.

Pro Bono Representation

In cases where a dispute arises over redundancy pay or eligibility, EmploymentLawUK can offer pro bono representation to help individuals secure their legal rights without the burden of legal fees. This ensures that anyone—regardless of financial status—has access to professional advice and representation.

What If You Don’t Receive Statutory Redundancy Pay?

If you believe that you are entitled to statutory redundancy pay but have not received it, you can take action. First, speak with your employer and seek clarification. If this doesn’t resolve the issue, you may want to consider raising a grievance or taking your case to an employment tribunal.

EmploymentLawUK can assist with this process by advising you on the next steps. It’s crucial to act quickly, as there are time limits for making a claim for unpaid redundancy pay. You may also be entitled to pursue a claim for unfair dismissal, depending on the specifics of your case.

Conclusion: Looking Ahead

Statutory redundancy pay is a crucial safety net for workers who are made redundant. Understanding how it’s calculated, who qualifies, and how to claim it can help ensure you receive the support you deserve in tough times. However, redundancy can also open the door to other opportunities, such as re-skilling, starting a new business, or finding a better-suited job.

With EmploymentLawUK by your side, you’ll have access to the expertise you need to navigate this challenging period with confidence. Remember, whether through providing free advice, helpful templates, or pro bono representation, their commitment to empowering individuals remains steadfast.

Redundancy can be an uncertain and challenging experience, but understanding your rights and having the proper support can transform this difficult situation into a new beginning. Stay informed, take action, and take control of your future.