Redundancy payment is a financial compensation that employers offer employees when removing their positions from the organizational structure. If an employee has worked continuously for an employer for two years or more and they are being made redundant, they have the right to a statutory redundancy payment. The legal minimum is called statutory redundancy pay, but employers might have to pay more if the employment contract says so. This is called contractual redundancy pay. The amount of redundancy pay depends on the employees age, employment duration, and the specifications in the employment contract. The first £30,000 of redundancy pay is tax-free, regardless of whether the employee gets the legal minimum or a more generous payout from the employer. The maximum statutory redundancy pay an employee can get in total is £20,070. Employers should give employees a written statement showing how any payment has been worked out. If an employee has doubts about the way their employer has calculated their statutory redundancy pay, they can call the Redundancy Payments Freephone Helpline.