What is redundancy payment?

A redundancy payment is a form of compensation offered when your job no longer exists. You may have the right to claim redundancy if you are an employee, or a director. There are two types of redundancy pay:

• Statutory redundancy pay – the payment rates are set down by law
• Contractual statutory pay – this varies from company to company. The details will be set out in your contract of employment.
  
  It is a legal requirement for all employees to hold a contract of employment.