How to Claim Statutory Redundancy Pay

Statutory redundancy pay is a legal payment owed to eligible employees when their job ends because the employer no longer needs the role. It is a minimum entitlement set out under UK employment law and applies across England and Wales.

Disputes commonly arise where employers refuse to pay, calculate the amount incorrectly, or delay payment. In such cases, employees may need to follow a formal process to recover what is owed, including making a claim to an employment tribunal.

This article explains eligibility, calculation rules, and the step-by-step process for claiming statutory redundancy pay, including time limits and enforcement options.

What Statutory Redundancy Pay Is

Statutory redundancy pay is the minimum amount an employer must pay an employee who is dismissed by reason of redundancy, provided they meet eligibility criteria.

It is separate from:

• Notice pay (payment for the notice period)
• Holiday pay owed on termination
• Any enhanced contractual redundancy payments

The legal basis for entitlement is primarily found in the Employment Rights Act 1996, with practical guidance set out by the government and interpreted through employment tribunal practice.

Eligibility for Statutory Redundancy Pay

An employee is generally entitled to statutory redundancy pay if all of the following apply:

• They are legally classed as an employee
• They have at least 2 years' continuous service
• They are dismissed due to redundancy (or certain qualifying lay-off/short-time situations)

Employees are not usually entitled if:

• They refuse suitable alternative employment without good reason
• They are self-employed contractors
• They have less than 2 years' service
• The dismissal is for reasons other than redundancy (for example, misconduct dismissal)

Government guidance confirms that continuous employment of 2 years or more is the key threshold for eligibility .

How Statutory Redundancy Pay Is Calculated

The statutory formula is based on three factors:

• Age
• Length of service (capped at 20 years)
• Weekly pay (capped at a statutory limit)

The standard calculation is:

• 0.5 week's pay for each full year under age 22
• 1 week's pay for each full year aged 22 to 40
• 1.5 week's pay for each full year aged 41 and over

Weekly pay is normally based on the average earnings over the 12 weeks before notice of redundancy. It is subject to a statutory cap (updated annually).

The maximum service that can be counted is 20 years .

Step-by-Step: How to Claim Statutory Redundancy Pay

1. Check Whether You Have Already Been Paid

Before starting a claim, the first step is to confirm:

• Whether redundancy pay has been included in final wages
• Whether the amount matches the statutory calculation
• Whether an enhanced contractual scheme applies

Employers are legally required to provide a written statement showing how redundancy pay was calculated if it is paid.

2. Raise the Issue with Your Employer

If redundancy pay has not been paid or appears incorrect, the next step is to raise the issue directly with the employer.

This is usually done in writing and should include:

• Employment dates
• Role and redundancy confirmation
• Calculation dispute (if relevant)
• Request for payment or clarification

Many disputes are resolved at this stage without formal proceedings.

3. Use ACAS Early Conciliation

Before making an employment tribunal claim, you must notify Acas and start early conciliation.

This process:

• Is mandatory before most tribunal claims
• Attempts to resolve the dispute without a hearing
• Freezes limitation deadlines while it is ongoing

If settlement is not reached, ACAS issues a certificate allowing a tribunal claim to proceed.

4. Submit an Employment Tribunal Claim (ET1)

If the employer still does not pay, a claim can be made to an employment tribunal using form ET1.

Key points:

• The claim is for “unpaid statutory redundancy pay”
• Evidence should include employment details, dismissal letter, and pay records
• The tribunal can order the employer to pay the statutory amount

Tribunals apply strict time limits for redundancy pay claims.

Time Limits for Claims

The standard time limit is:

• 6 months minus 1 day from the date employment ended

This is longer than most employment claims, but it is still strict.

Important rules:

• Internal grievance procedures do not extend the deadline
• ACAS early conciliation pauses the limitation clock temporarily
• Late claims are only accepted in limited circumstances

If the Employer Cannot Pay (Insolvency)

If the employer is insolvent or has ceased trading, statutory redundancy pay may be claimed from the government via the Insolvency Service Redundancy Payments Service.

This applies where:

• The employer cannot meet liabilities
• A formal insolvency process is underway

Employees may also be able to claim other unpaid entitlements such as wages and holiday pay through the same route.

Common Problems and Disputes

1. Incorrect Calculation

Errors often occur in:

• Age band application
• Service length calculation
• Weekly pay cap application

2. Disputed Redundancy Status

Employers may argue the dismissal was not redundancy. This affects entitlement entirely.

3. Failure to Pay on Time

Statutory redundancy pay should be paid on dismissal or shortly after. Delay can justify tribunal action.

4. Alternative Employment Offers

Refusal of suitable alternative roles without valid reason can remove entitlement.

Enforcement Options

If payment is not made voluntarily, enforcement routes include:

• Employment tribunal judgment enforcement through the County Court
• Deduction from wages orders (in some cases)
• Insolvency Service claims where applicable

Practical Summary

To claim statutory redundancy pay:

• Confirm eligibility (2 years' service and redundancy dismissal)
• Check whether the amount has been correctly calculated
• Raise the issue with the employer in writing
• Start ACAS early conciliation if unresolved
• Submit an employment tribunal claim within 6 months minus 1 day if needed
• Use insolvency procedures where the employer cannot pay

Statutory redundancy pay is a minimum legal entitlement, and formal legal routes exist to recover unpaid amounts where employers fail to comply.