Redundancy Rights in the UK: What You're Entitled To

Understand your statutory entitlements and challenge unfair redundancy

Quick Answer

If made redundant after 2+ years, you're entitled to a statutory redundancy payment, notice pay, and accrued holiday. Amounts depend on age, salary, and service (up to £30,000 tax-free). The employer must follow fair procedure: warn staff, consult, consider alternatives (redeployment, training), and select fairly. If they skip these steps, claim unfair dismissal.

What You're Entitled To

Statutory redundancy payment: Calculated as 0.5 week's pay per year (under 22), 1 week's pay (22–40 years), or 1.5 weeks (40+ years), capped at 30 years' service and a weekly maximum of £643 (2026). Total cap: ~£30,000, which is tax-free.

Notice pay: Your employer must give statutory notice (1–12 weeks depending on service), or pay in lieu. During notice, you have the right to time off to look for work.

Holiday pay: Accrued holiday owed (current year plus any rolled-over balance) must be paid in full.

Fair Redundancy Procedure

1. Warn and inform staff. Employers must warn affected employees and unions/reps early enough for consultation (typically 30+ days for large layoffs).

2. Consult genuinely. Listen to suggestions for alternatives (voluntary redundancy, shared hours, retraining). Consultation must be genuine, not a formality.

3. Use fair selection criteria. LIFO (last-in-first-out) is the standard, but employers can use skills, performance, or flexibility. Criteria must not be discriminatory (age, sex, disability, etc.).

4. Offer alternatives. Redeployment to other roles if available. Retraining to fit another role. If you're offered a suitable alternative, you don't lose redundancy rights.

What the Law Says
Employment Rights Act 1996, Sections 135–181
Defines redundancy, entitlements, and procedure. Section 135 covers redundancy payments. Section 139 defines "redundancy" as cessation of work or reorganisation requiring fewer employees.
TULRCA 1992, Section 188
Requires collective consultation on redundancy (30–90 days depending on scale). Applies when 20+ employees at one site or 100+ across multiple sites. Failure to consult breaches statute.
Employment Rights Act 1996, Section 98(4)
For unfair redundancy claims, the tribunal examines whether the employer followed fair procedure and reasonable decision-making. Procedural errors make dismissal unfair even if redundancy was genuine.
I've only worked 18 months. Do I get redundancy pay? +

No statutory redundancy pay under 2 years' continuous service. However, you may be entitled to notice pay and accrued holiday. Check your contract for any enhanced redundancy schemes. You also have grounds to claim unfair dismissal if procedure was unfair.

Can I refuse a suitable alternative role and keep redundancy? +

No. If offered a suitable alternative role within the notice period, accepting it continues your employment. Unreasonably refusing a suitable offer can disqualify you from redundancy pay. However, if the role is genuinely unsuitable (major pay cut, demotion, relocation), you can refuse and still claim redundancy.

Is redundancy on "last-in-first-out" always fair? +

LIFO is the standard, but not automatic. Employers must show it was fair in the circumstances. If it disproportionately affects a protected group (e.g., all women, all older workers), it may be discrimination. Individual performance or flexibility can override LIFO if applied fairly.

What if my employer didn't consult before redundancy? +

If collective consultation was required (20+ employees at one site) and didn't happen, the union can sue for a protective award (2–90 days' pay). For individual employees, lack of consultation is a procedural failure, making dismissal unfair. Claim unfair dismissal at tribunal.

Can I claim redundancy if the role is later re-advertised? +

Yes. If the employer claims redundancy but then fills your role, the tribunal will likely find the dismissal was not genuinely for redundancy but unfair dismissal (absence of fair reason). This is grounds for a large compensation claim. Keep evidence of the re-advertised role.

Understand Your Rights