If your pay is the same every week, this is simple: that is your weekly pay.
If it varies — shift work, commission, irregular overtime, zero hours — statutory redundancy pay uses your average gross weekly pay over the 12 weeks before you were told about the redundancy.
Which 12 weeks
The 12 weeks ending with the last complete week before the date you were given notice. Not the 12 weeks before your employment ends, and not the last 12 weeks of the calendar year.
This matters because the date you were told can be months before the date you leave. Using the wrong window produces a different figure.
Weeks in which you earned nothing are skipped, and an earlier week is used in its place, so that a full 12 weeks of actual pay make up the average. A month of unpaid leave does not drag your average down.
What counts as pay
Included:
- Basic pay
- Contractual overtime you are obliged to work
- Commission and bonuses that form part of normal pay
- Shift premiums and regular allowances
Excluded:
- Voluntary overtime not required under your contract
- Expenses and genuine reimbursements
- Benefits in kind
- Discretionary one-off bonuses
The overtime distinction is the awkward one. For redundancy purposes it turns on whether the contract obliges you to work it — and this is deliberately different from holiday pay, where regular voluntary overtime should be included. Two calculations, two rules, and it is not unusual to see an employer apply the holiday rule to redundancy or the reverse.
Use gross pay, before tax and National Insurance.
Age is counted for each year of service, reckoning backwards from the date employment ends — not your age today.
Then the cap applies
Once you have your average, the statutory cap applies:
| Where you work | Weekly pay cap 2026/27 | Maximum total |
|---|---|---|
| England, Scotland and Wales | £751 | £22,530 |
| Northern Ireland | £783 | £23,490 |
If your average is above the cap, the cap is used instead. Someone averaging £900 a week is paid as though they earned £751.
This means precise averaging only changes your outcome if your average lands below the cap. Above it, the cap does the work.
Calculate with your average weekly pay
If you have not worked 12 weeks
For someone with less than 12 weeks in the job, the average is taken over the weeks actually worked. Note that statutory redundancy pay needs two years’ continuous service in any case, so this mainly arises where working patterns changed recently rather than where employment is genuinely new.
Sick pay and family leave in the reference period
Weeks on statutory sick pay, maternity, paternity, adoption or shared parental leave count as weeks with reduced pay rather than weeks with no pay, which can pull an average down significantly.
Where the reduced pay results from being on family leave, the average should generally be based on what you would have earned working normally. If a period of family leave falls in your 12 weeks and your redundancy figure looks low, this is worth raising — it is a known source of underpayment.
Term-time and annualised hours
For staff paid the same amount monthly across the year despite working only part of it, weekly pay is generally the annual salary divided by 52 rather than the pay received during the 12 weeks in question.
For genuinely annualised hours the position depends on the contract. If your pay is smoothed across the year, the smoothed figure normally applies.
Checking your employer’s figure
- Identify the date you were told about the redundancy, not your leaving date.
- Take the 12 complete weeks before that date.
- Skip any week with no pay and go back a week further for each one skipped.
- Add the gross pay for those 12 weeks and divide by 12.
- Apply the cap if the result exceeds it.
If your figure differs from your employer’s, ask them to show the weeks they used. The most common causes are using the wrong 12 weeks, including weeks with no pay, or excluding contractual overtime that should have counted.
Enhanced schemes
If your employer pays enhanced redundancy under a contractual scheme, that scheme’s definition of weekly pay applies — often “basic salary” with no cap, which is more generous than the statutory position. The statutory rules only govern the statutory minimum.
Sources
- Calculate your statutory redundancy pay — GOV.UK
- Employment Rights Act 1996, section 221 — legislation.gov.uk
- Redundancy pay — Acas
Checked against source on 30 August 2026. This is general guidance, not legal advice.
Written by Nathan Cole
I built the calculators on HoursHQ and check every statutory figure against GOV.UK, Acas and the legislation itself before it goes live. Where the law is genuinely unclear, I say so rather than guessing.