How much redundancy pay will I get?

What is statutory redundancy pay?

Where you lose your job because your employer is closing the business or reducing staff numbers, this is known as redundancy.

You are entitled to get a minimum redundancy payment after you have 2 years’ (104 weeks) service in your job. This is known as a statutory redundancy. The statutory redundancy payment is based on a calculation using your pay and your length of service.

How much redundancy pay will I get?

The statutory redundancy payment is a lump-sum based on your pay and length of service.

If you are eligible for redundancy pay, you are entitled to:

  • Two weeks' pay for every year of service
  • One additional week's pay

The maximum weekly amount used to calculate redundancy pay is €600 a week (or €31,200 a year), even if your pay is more per week.

You can use this redundancy calculator to estimate how much statutory redundancy pay you might be entitled to.

You can see examples of redundancy calculations on gov.ie.

Top up payments

Your employer is not legally obliged to pay anything on top of the normal statutory entitlements, that is, notice and statutory redundancy.

Your employer may want to give you a voluntary top-up payment on the basis that this is the industry norm.

You may have a contractual right to a top-up payment if this is stated in your contract of employment, a collective agreement or from the custom and practice of their employer.

Do I pay tax on the statutory redundancy payment?

The statutory redundancy payment is tax-free. If you get a lump sum as compensation for losing your job, part of it may be tax-free.

Read more about how lump-sum payments on redundancy are taxed.

More information on whether elements of the payment, such as pay in lieu of notice, is taxable is available on the Revenue website.

How is my gross weekly pay calculated?

When calculating your redundancy payment, pay means your gross pay before tax and PRSI deductions.

Gross weekly pay includes:

  • Your current normal weekly pay
  • Average regular overtime
  • Benefits-in-kind

If you are paid monthly, your normal monthly pay is divided by 4.33 to calculate the weekly pay.

My wages change from week to week

Where you do not have regular hours or regular pay, an average of the last 52 weeks worked is used.

How is average regular overtime calculated?

Average weekly overtime is calculated as follows:

  • You exclude any overtime for the 13 weeks before the date of redundancy
  • Find the total amount of overtime earned in the previous 26 weeks (excluding the 13 weeks before the date of redundancy)
  • If there were any weeks you did not work in the 26 weeks, then the 26 weeks can be extended back for every week not worked
  • Divide the total by 26 to get the average weekly overtime

This average overtime is added to the normal weekly pay.

I was earning less than the minimum wage

If you were earning less than the minimum wage you may be entitled to payment based on the minimum wage. There are exceptions for any period you were in a statutory apprenticeship or under 20 years of age.

You can read more about how gross weekly pay is calculated on gov.ie.

How is my length of service calculated?

Reckonable service is the length of time you have been continuously employed in your job that is taken into account when calculating a redundancy payment.

Reckonable service does not mean how many weeks you were employed for. It means how long you were actually in work doing the work. So reckonable service does not include certain absences from work.

Absences from work over the last 3 years are taken into account in calculating of the length of your service. Any absences outside of this 3-year period are not counted. The 3-year period ends on the date your employment ends.

What is counted as reckonable service?

The following periods are included as reckonable service, (called reckonable absences):

  • The period you were actually in work
  • Any absence from work due to holidays
  • Any absence from work due to illness (see below for non-reckonable periods of illness)
  • Any period where you were absent from work by agreement with your employer (typically career break)
  • Any period of basic and additional maternity leave allowed under the legislation
  • Any period of basic adoptive, paternity, parental, parent’s or carer's leave
  • Any period of lock-out from your employment
  • Any period where the continuity of your employment is preserved under the Unfair Dismissals Acts

What is not counted as reckonable service?

The following periods over the last 3 years are not counted as service, (called non-reckonable absences):

  • Any period over 52 consecutive weeks where you were off work due to an injury at work
  • Any period over 26 consecutive weeks where you were off work due to illness
  • Any period on strike
  • Any period of lay off from work

You can see examples of redundancy calculations on gov.ie. Example 4 covers reckonable absences included in the calculation and Example 5 covers non reckonable absences excluded from the calculation.

Lay off from work due to COVID-19 and reckonable service

If you were on the Temporary COVID-19 Wage Subsidy Scheme (TWSS) or Employment Wage Subsidy Scheme (EWSS), this period is counted as reckonable service for calculating statutory redundancy.

However, any period of layoff during the pandemic is not counted as reckonable service (read about reckonable service in ‘How is my length of service calculated?’ above).

Special payment if you lost out on reckonable service

If you lost out on reckonable service while temporarily laid off during COVID-19 and you are made redundant, you may be able to get a special payment up to €2,268 (tax-free). You can apply for the payment from 19 April 2022 (see ‘How to apply for the special redundancy payment’ below).

The amount you get depends on how long you were on layoff. For example, if you earned €600 or more a week and were laid off for the entire emergency period, you will get the maximum amount of €2,268.

The payment will apply to employees who:

  • Are made redundant between 13 March 2020 and 31 January 2025
  • Have lost reckonable service due to layoffs between 13 March 2020 and 31 January 2022 (the emergency period), caused by COVID-19 restrictions

You can be eligible for the payment, whether or not you were getting the PUP or a jobseeker’s payment during layoff.

The Redundancy Payments (Amendment) Act 2022 sets out the legal basis for the special payment. The Act came into effect on 19 April 2022.

How to apply for the special redundancy payment

Your employer should apply for the payment on your behalf to the Department of Social Protection.

If your employer does not apply on your behalf, contact the redundancy payments section in the Department of Social Protection (you can find contact details under ‘More information’ below).

The amount of the payment will be determined by the difference between:

  • The lump sum you would have been entitled to on redundancy if you had not been laid off due to COVID-19
  • The amount you are actually entitled to on being made redundant

Read more about the COVID-19 Related Lay-Off Payment Scheme, including how to calculate your payment, on gov.ie.

I was made redundant after being on reduced hours or pay

How your payment will be calculated depends on whether you are made redundant:

  • Within a year of being put on reduced hours or pay, or
  • After working reduced hours for more than a year

You are made redundant within a year of being put on reduced hours or pay

If you are made redundant within a year of being put on reduced hours or pay, your redundancy payment is based on your earnings for a full week.

You are made redundant after working reduced hours for more than a year

If you are made redundant after working reduced hours for more than a year, how your payment is calculated depends on whether you accepted being on reduced hours or not.

Your situation How your payment is calculated
You fully accepted the reduced hours Your redundancy payment is based on your gross pay for the reduced working hours if :
  • You fully accepted the reduced working hours as your normal week
  • You never asked to return to full-time work
You never accepted the reduced hours Your payment is based on your normal weekly earnings if:
  • You never accepted the reduced working hours as your normal hours
  • You continually asked to be put back on full-time working

How do I get my redundancy pay?

Your employer should pay the redundancy lump sum to you when your employment ends. For example, this could be the last day of your notice period or on your next pay day.

If your employer is paying you the redundancy lump sum, they do not have to submit an online application form (previously called the RP50 form).

However, your employer should get proof that they paid your lump sum to you and give you a copy of the proof of payment.

Your employer should also give you a written statement showing how any payment has been worked out.

If I do not get my redundancy pay

If your employer does not give you statutory redundancy pay when you are entitled to it, you should write to them asking for payment. If you have an employee representative, such as a trade union official, they may be able to help.

If your employer has not paid your redundancy lump sum, you should apply to your employer for it using form RP77 (pdf).

If your employer cannot pay or they are insolvent, you can apply to get the payment from the Government under the Social Insurance Fund. Get more advice if your employer cannot pay and you are having problems getting your redundancy pay.

Your employer refuses to pay or there is a dispute about redundancy

If your employer refuses to pay your redundancy lump sum or if there is a dispute about redundancy you can bring a claim to the Workplace Relations Commission. Complete and submit the online complaint form available on workplacerelations.ie. This must be done within one year of your dismissal.

Read more about the steps you need to take if your employer refuses to pay or where there is a dispute.

More information

You can get more information about the Redundancy Payments Scheme on gov.ie, on the Irish National Organisation of the Unemployed (INOU)'s website inou.ie or from the Workplace Relations Commission's Information and Customer Services.

The application for payment from the Social Insurance Fund should be sent to:

Redundancy Payments Section

Department of Social Protection

Ground Floor
Gandon House
Amiens Street
Dublin 1
D01 A361

Tel: (01) 673 4500 or 0818 111 112

For further information about the Redundancy Payments Scheme contact:

Workplace Relations Commission - Information and Customer Service

O'Brien Road
Carlow
R93 E920

Opening Hours: Mon. to Fri. 9.30am to 1pm, 2pm to 5pm
Tel: (059) 917 8990
Locall: 0818 80 80 90
Page edited: 2 June 2022