Maximum statutory redundancy payment to increase in October 2009
The maximum amount of a week's pay used to calculate statutory redundancy payments and unfair dismissal compensation will increase to £380 on 1 October 2009.
The rise from £350 to £380 was announced in the 2009 Budget in April, but there had been no official confirmation until now as to when the change would come into force. The limit usually increases every February, in line with the retail prices index. The October 2009 increase will be a one-off increase intended to help people being made redundant; there will be no further increase in February 2010.
As well as statutory redundancy pay, the increased weekly pay limit will be used to calculate compensation for unfair dismissal and other claims such as failure to consult on collective redundancies. Anyone earning over £380 per week will have his or her weekly pay capped at £380 for the purposes of calculating compensation for these claims.
- The Work and Families (Increase of Maximum Amount) Order 2009 - Final Impact Assessment (PDF format, 169K) Confirmation that the increase in the weekly limit for statutory redundancy pay will come into force on 1 October 2009 is available on the Department for Business, Innovation and Skills website.
Also
Budget 2009: Statutory redundancy pay to increase to £380 a week Statutory redundancy pay to increase from £350 per week to £380 per week, the chancellor's Budget has confirmed.
Statutory redundancy payment worked examples The XpertHR worked examples section includes a number of illustrations of how to calculate statutory redundancy pay.
Redundancy payment Guidance from XpertHR on the calculation of redundancy payments, including a ready reckoner for statutory redundancy calculations.
