How is redundancy pay worked out?
Statutory redundancy pay depends on age, full years worked and a week's pay. Work it out, with the cap on a week's pay given in the question.
This path is practice in how the records and the sums work. It is not tax advice. Any rate or allowance in a question is an example for that question, so check GOV.UK for the current figures.
An employee is made redundant when their job is no longer needed. After at least 2 full years with the employer, the law gives them statutory redundancy pay. A contract can give more.
- Half a week's pay for each full year worked while under 22
- One week's pay for each full year worked while aged 22 to 40
- One and a half weeks' pay for each full year worked while aged 41 or over
Only full years count, and no more than the last 20. A week's pay is the employee's normal gross pay for a week, up to a cap. The cap changes every year, so the question gives it.
Kestrel Row Cycles closes its second shop, across town, and the staff there are made redundant.
You work out a figure and find the mistake in a table.