Statutory redundancy rights and pay — your legal minimum
Quick answer: If you are made redundant after 2 years of continuous service, you are entitled to a statutory redundancy payment, a notice period, time off to look for work and (in larger redundancies) a consultation period.
If you are made redundant after 2 years of continuous service, you are entitled to a statutory redundancy payment, a notice period, time off to look for work and (in larger redundancies) a consultation period. Many employers go further than the legal minimum.
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Primary source: https://www.gov.uk/redundancy-your-rights
What counts as a genuine redundancy
Redundancy is a specific legal reason for dismissal — the job no longer exists, the workplace is closing, or there are too many people doing the role. If the dismissal isn't genuinely a redundancy you may have an unfair-dismissal claim.
Your employer must use a fair selection process. Common criteria: skills, qualifications, attendance and disciplinary record. Selecting on discriminatory grounds (age, pregnancy, disability) is unlawful.
Notice, pay and consultation
You are entitled to statutory minimum notice: one week per year of service up to 12 weeks. Your contract may give more. During the notice period you continue to be paid normally.
Where 20+ redundancies are proposed at one workplace, the employer must consult collectively (with a union or elected reps) for at least 30 days (45 days for 100+). Smaller redundancies still require fair individual consultation.
During the notice period you have the right to reasonable paid time off to look for a new job or arrange training.
If your employer is insolvent
If your employer goes into administration or liquidation, you can claim redundancy pay, notice pay (up to statutory maximum), unpaid wages (up to 8 weeks) and unpaid holiday pay (up to 6 weeks) from the government's Redundancy Payments Service.
Statutory payments via RPS are capped at the same £719/week as a normal claim. Apply within 6 months of dismissal.
Common questions
- Is my settlement agreement worth signing?
- An employer often offers more than the statutory minimum in return for you signing a settlement agreement that waives further claims. You must take independent legal advice before signing — and the employer normally pays a contribution to those legal fees.
- What about my pension and benefits?
- Employer pension contributions stop at the termination date. You can usually leave the pension where it is or transfer it. Death-in-service, private health cover and other benefits usually end on the termination date unless the settlement extends them.
- Will redundancy affect Universal Credit?
- Statutory redundancy pay counts as capital, not income — so it affects UC only if it pushes your total capital above £6,000 (taper) or £16,000 (no UC). Notice pay counts as earnings in the month received.