The TUC is calling on the Chancellor to increase the weekly limit on statutory redundancy pay from £330 to £500 in the forthcoming Budget as a major step towards restoring the real value of the limit when it was first introduced at £40 in 1965. Anyone who has worked for the same employer for more than two years is entitled to redundancy pay (which is paid by the Government if the employer goes bust). It is calculated as half a week's pay for each year of employment between the ages of 18 to 21; plus one week's pay for each year of employment between 22 to 40; and one and a half week's pay for each year of employment between the age of 41 or over but under 65. But there is a statutory maximum limit to what counts as a week's pay - anything earned in excess of this limit is not counted when working out redundancy pay. This is set annually and is currently £330 per week. Official figures show that more than half the working population earn more than this a week (53 per cent). Mean pay is £452 a week, so the current limit is just 73 per cent of average pay. Employers are free to offer more generous terms, and many do.
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