Settlement agreement calculator

Use the calculator to see the statutory minimum you are owed when your job ends: statutory redundancy pay and statutory notice. If your employer has made an offer, enter it to see how much of it is extra. That extra is the part you are being paid to give up your claims, and it is the part worth negotiating.

How the calculator works

It applies two rules from the Employment Rights Act 1996.

Statutory redundancy pay (section 162). Half a week's pay for each full year you worked while under 22, one week for each year aged 22 to 40, and one and a half weeks for each year aged 41 or over. Only the last 20 years count and you need two years' service. A week's pay is capped at £751 for redundancies on or after 6 April 2026, which makes the maximum £22,530.
Statutory minimum notice (section 86). One week once you have worked for a month, then one week for each complete year of service, up to twelve weeks. Notice pay is not capped.

The calculator runs in your browser. Nothing you type is sent to us or stored.

What the calculator leaves out

Holiday you have built up and not taken.
Bonus and commission you have already earned.
Notice under your contract, where it is longer than the statutory minimum.
An enhanced redundancy scheme, where your employer has one.
The value of your claims. This is usually the largest figure, and no calculator can give it.

Statutory redundancy pay is only due where the reason for leaving is redundancy. If you are leaving for another reason, ignore that line and look at notice and the value of your claims.

How much should a settlement agreement pay?

There is no standard figure. A fair offer starts with everything you are owed anyway and then adds a sum for the claims you are giving up. Three things usually decide that sum: how long you have worked there and what you earn, how strong your claim is, and how long it is likely to take you to find similar work.

For an unfair dismissal claim a tribunal awards a basic award, worked out in the same way as statutory redundancy pay, and a compensatory award for your lost earnings. For dismissals up to 31 December 2026 the compensatory award is capped at the lower of 52 weeks' gross pay or £123,543. The cap is removed for dismissals from 1 January 2027. Discrimination claims have no cap and include an award for injury to feelings.

We compare your offer with what you could realistically win at a tribunal, after the cost, delay and risk of a claim, and tell you in plain numbers. See settlement agreements.

Tax on a settlement payment

The first £30,000 of a payment made because your job is ending is normally free of income tax and National Insurance. Statutory redundancy pay counts towards that £30,000. Pay you were owed anyway, such as salary, holiday pay, bonus and notice pay, is taxed in the usual way.

Questions people ask

Is there a formula for settlement agreement payments?

No. Statutory redundancy pay and notice follow fixed rules, and the calculator works those out. The rest depends on the strength and value of the claims you are giving up.

What is a good settlement offer?

One that pays everything you are owed anyway and adds a sum that reflects what you could realistically win at a tribunal, allowing for the cost, delay and risk of a claim.

Does the calculator work for voluntary redundancy?

Yes. Statutory redundancy pay is the same for voluntary and compulsory redundancy. Voluntary schemes usually pay more, so enter the offer to see how much is extra.

What is the maximum statutory redundancy pay?

£22,530 for redundancies on or after 6 April 2026. That is 30 weeks' pay at the capped rate of £751 a week.

My offer is the statutory minimum. Should I sign?

Take advice first. On those figures you are being asked to give up your claims for nothing extra. A solicitor has to advise you before a settlement agreement binds you, and your employer usually pays for that advice.