Reviewed in February 2013 and no substantive changes made
Statutory redundancy pay and basic award calculator
Ready reckoner table for calculating the statutory redundancy payment or unfair dismissal basic award due to an employee.
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To calculate a statutory redundancy payment or unfair dismissal basic award under section 162 ( www.practicallaw.com/5-509-0979) or 119 ( www.practicallaw.com/1-509-0735) of the Employment Rights Act 1996 ( www.practicallaw.com/2-503-9360) (ERA 1996), use the table to find the appropriate multiplier based on the employee's age and number of complete years' service at the date of dismissal. Multiply this by the employee's gross weekly pay, subject to the limit on a week's pay applicable at the date of dismissal (see Checklist, Current rates and limits ( www.practicallaw.com/4-200-2038) ).
For the purposes of this table, employees whose employment ends on the day before their 23rd or 42nd birthday should be treated as if they were 23 or 42 respectively. This is because they will have served a complete year at age 22 or 41 and therefore fall into the next age bracket.
Employees must have at least two years' continuous service in order to qualify for statutory redundancy pay.
Those employees whose employment commenced before 6 April 2012 must have at least one year's service to bring a claim for ordinary unfair dismissal. However, the Unfair Dismissal and Statement of Reasons for Dismissal (Variation of Qualifying Period) Order 2012 increased the period of continuous service required to two years for those whose employment commenced on or after that date.
A maximum of 20 years' service should be taken into account when calculating both the basic award and the statutory redundancy payment (section 162(3) ( www.practicallaw.com/5-509-0979) and 119(3) ( www.practicallaw.com/1-509-0735) , ERA 1996).
For detailed information on calculating redundancy payments or basic awards, see Practice notes, Redundancy (4): statutory redundancy payments: Calculating a statutory redundancy payment ( www.practicallaw.com/7-383-2722) and Unfair dismissal: compensation and remedies: Basic award ( www.practicallaw.com/5-386-1008) .
For an automatic statutory redundancy pay calculator, see the BEIS redundancy ready reckoner ( www.practicallaw.com/0-200-3172) .