Made redundant in the UK: how much you are owed and what to do if you are on a work visa

The statutory maximum redundancy payment is £22,530: no more than £751 for each week of service, no more than 20 years of service, and only after two years of continuous employment. The first £30,000 is tax free. If you are on a Skilled Worker visa the clock runs in days, not months: after redundancy the Home Office leaves you 60 days, or whatever is left on the visa if that is less. Here is what you are owed, in what order to claim it, and where to get free advice.

What counts as redundancy and what does not?

Redundancy is a dismissal where the job itself disappears, not where there is a complaint about the worker. The business or site closes, the volume of work falls, the role is no longer needed. If the work is handed to someone else in the same post, that is not redundancy and the formula below does not apply — but it may be grounds for an unfair dismissal claim.

Dismissal for misconduct is not redundancy and carries no redundancy payment. The right to a payment is also lost in two other cases: your employer offered to keep you on and you refused, or you turned down suitable alternative work without a good reason.

How much are you owed by law?

Statutory redundancy pay is calculated by age and length of service, for each full year worked:

— half a week's pay for each full year you were under 22;
— one week's pay for each full year you were 22 or older but under 41;
— one and a half weeks' pay for each full year you were 41 or older.

Length of service is capped at 20 years, counting back from the end of employment. A week's pay is the average over the 12 weeks before the day you were given notice, and it is capped: from 6 April 2026 the cap is £751 a week (£719 if the redundancy happened earlier). That produces the maximum: 20 years at 1.5 weeks is 30 weeks, and 30 × £751 = £22,530.

An example. Someone aged 45 with eight years' service earning £900 a week. The calculation uses £751, not £900. All eight years were worked after turning 41, so 8 × 1.5 = 12 weeks. That is 12 × £751 = £9,012.

The minimum service requirement is two continuous years. Your employer must set out in writing how the figure was reached. Payment is due on your last working day or on your normal pay date; a later date is only valid if agreed in writing. Many employers pay more than the minimum — this is enhanced redundancy, and the terms are usually in the contract or the staff handbook.

Is the payment taxed?

The first £30,000 of a redundancy payment is free of both income tax and National Insurance. The threshold applies to the whole non-contractual termination payment taken together, not to each element separately.

One important exception: notice pay is taxed and subject to National Insurance in full, and does not count towards the £30,000. The same applies to unpaid wages, pay for untaken holiday and contractual bonuses — all of these are ordinary taxable pay.

How much notice must you be given?

The statutory minimum depends only on length of service: one week if you have worked between one month and two years; one week for each full year if you have worked between two and twelve years; twelve weeks if you have twelve years or more, which is the ceiling. A contract can give more, never less.

Instead of working the notice, an employer can use payment in lieu of notice (PILON): you leave immediately and are paid full basic salary for the whole notice period. Ask for contractual benefits for that period too — pension contributions, medical insurance. Notice pay is based on the average of the 12 weeks before the notice period starts, and the £751 cap does not apply to it.

Do you get paid time off to look for work?

Yes, if you have two years' service or more and are employed as an employee. The law gives you a "reasonable amount" of paid time during the notice period to attend interviews or arrange training. An employer can only refuse on reasonable grounds.

The limit few people know about: pay for that time is capped at 40% of a week's pay in total across the whole notice period, however many hours you take. You can take more time; you will not be paid more than that share.

Must your employer consult you first?

If 20 or more people are being made redundant at one establishment within 90 days, consultation is a legal requirement: at least 30 days before the first dismissal for 20 to 99 redundancies, at least 45 days for 100 or more. The employer must set out in writing the reasons, the number and categories of staff affected, the selection method, how the process will run and how payments are calculated, and must notify the Redundancy Payments Service on form HR1. Failing to notify RPS carries an unlimited fine.

Below 20 redundancies there is no statutory collective consultation period. Individual consultation is still effectively mandatory: its absence is one of the most common reasons a tribunal finds a dismissal unfair.

Since April 2026 the maximum protective award for breaching consultation rules has doubled from 90 to 180 days' pay.

What if you are on a Skilled Worker visa?

This is the most urgent item on the list. Your sponsor must report the end of your employment to the Home Office through the sponsorship system within 10 working days, and must pass on your last known address, phone number and personal email. The Home Office then sends a curtailment letter: you have 60 days, or whatever is left on the visa if that is under 60 days. The exact expiry date is stated in the letter itself, and that is the date everything else is counted from.

There are three lawful options in that window: find a new sponsor and make a new application, switch to another visa route, or leave the country. A new job needs a new Certificate of Sponsorship and a new visa application — you cannot start work before the decision. You can apply up to three months before the job start date, a decision usually takes up to eight weeks, and until it arrives you cannot travel outside the UK, Ireland, the Channel Islands or the Isle of Man.

On settlement: the five-year qualifying period for indefinite leave to remain depends on continuous lawful permission, not on continuous employment. As long as your existing permission has not lapsed and the new application is made in time, the period keeps counting. The separate limit of 180 days outside the UK in any 12 months still applies. If your case is unusual, check it against Home Office guidance rather than advice in chat groups.

How is selection made, and when is it unlawful?

Selection criteria must be objective and measurable: performance, skills and qualifications, attendance, disciplinary record. Absences related to disability or pregnancy must be excluded from attendance records.

Selection on any protected characteristic under the Equality Act 2010 is automatically unfair: age, disability, gender reassignment, marriage or civil partnership, pregnancy and maternity, race, religion or belief, sex, sexual orientation. So is selection for taking parental leave or carer's leave, for union membership or acting as an employee representative, for working part time or on a fixed-term contract, for raising working time complaints, for reporting a minimum wage breach, or for whistleblowing. No minimum service is needed to claim in these cases.

Indirect discrimination is a separate issue. Using the fact that someone works flexibly as a selection criterion, for example, may amount to sex discrimination.

What if you are offered a different job?

Any offer of alternative work carries a statutory four-week trial period. It can only be extended if training is needed, and only by written agreement made before the trial period begins.

The key rule: if you say within those four weeks that the job is not suitable, all your rights are preserved, including statutory redundancy pay. Stay silent past the deadline and the right to payment is lost. Refusing suitable alternative work without good reason also removes the right to payment — but whether the work really was suitable can be challenged at a tribunal.

How long do you have to go to a tribunal?

The rules change this autumn and the date matters. For situations arising on or before 30 September 2026, the deadline for an unfair dismissal claim is three months less one day from the effective date of termination. For situations arising on or after 1 October 2026, the deadline for most claims, including unfair dismissal, rises to six months less one day. It is one of the changes taking effect on 1 October. For unpaid statutory redundancy pay the deadline was already six months less one day.

Before filing you must notify ACAS of the dispute — this is early conciliation. Taking part is voluntary for both sides, but notification is not, and the tribunal will not accept a claim without the certificate number ACAS issues. The process takes up to 12 weeks and stops the clock on your deadline — but only if you contact ACAS within the original time limit.

An ordinary unfair dismissal claim requires two years' service. That threshold drops to six months in January 2027, but the two-year rule still applies in autumn 2026.

What if your employer becomes insolvent?

In that case the state pays through the Redundancy Payments Service. You can claim redundancy pay on the normal formula for up to 20 years of service; unpaid wages, bonuses and contractual overtime for up to 8 weeks; holiday pay for up to 6 weeks; and statutory notice pay at one week per year up to 12 weeks. Everything is subject to the same £751 weekly cap.

You apply online on GOV.UK. You will need the insolvency case number, which the appointed insolvency practitioner provides.

What benefits can you claim after redundancy?

Two different benefits, and they can be claimed together.

New Style Jobseeker's Allowance is £95.55 a week if you are 25 or over and £75.65 if you are 18 to 24, paid for up to 182 days. There is one condition: paid or credited Class 1 National Insurance contributions for the two previous tax years. Savings are ignored entirely — yours and your partner's — and your partner's income does not affect it either. It is paid fortnightly, with the first payment about two weeks after a seven-day waiting period.

Universal Credit is means tested. The monthly standard allowances are £338.58 for a single person under 25, £424.90 for a single person 25 or over, £528.34 for a couple both under 25, and £666.97 for a couple where at least one is 25 or over. Savings below £6,000 are ignored; between £6,000 and £16,000 the award falls by £4.35 for every £250 above the threshold; above £16,000 there is no entitlement.

The trap most people fall into: redundancy pay counts as capital. A £20,000 payment sitting in your account is above the £16,000 limit, so you will get no Universal Credit until it is spent down, and the change must be reported as a change of circumstances. New Style JSA has no such problem — it looks only at your contributions.

Claim Universal Credit immediately: it runs from the date you submit the claim, backdating is capped at one month and allowed only in narrow cases, and the first payment takes around five weeks. You can request an advance while you wait.

What if you have less than two years' service?

You get no statutory redundancy pay and cannot bring an ordinary unfair dismissal claim. Everything else still applies.

Notice of at least one week after the first month of employment, and pay for that period. Pay for accrued untaken holiday. A place in collective consultation if 20 or more are being made redundant — service length is irrelevant there. Protection against discrimination under the Equality Act 2010 and against automatically unfair dismissal, from day one with no qualifying period. Enhanced protection during maternity, adoption and shared parental leave also applies regardless of service.

What should you do in the first week?

The order of actions that saves the most money:

1. Ask your employer, in writing, for the calculation of your payment and for the reasons and selection criteria. You are entitled to both.
2. Claim Universal Credit the same day, and New Style JSA if you have the contributions. Every day of delay is money lost.
3. If you are on a work visa, find the Home Office letter and write down your permission expiry date. Everything else counts from it.
4. Check your contract for enhanced redundancy terms, a longer notice period and any termination payments.
5. Do not sign a settlement agreement straight away. It removes your right to claim, and the law requires your employer to pay for independent advice before you sign.
6. Take your paid time off to look for work if you have two years' service.

Free official advice on employment rights comes from ACAS: 0300 123 1100, weekdays 8am to 6pm. You do not need to pay anyone upfront for a "free consultation" about redundancy. Citizens Advice gives free help on money and benefits.

The deadlines that matter are collected in the ONLYWAY calendar.

Read also: UK job vacancies are lower than in any year since 2014 · Universal Credit: who can claim it