Market by market
Australia
NES redundancy pay starts at 4 weeks after one year and peaks at 16 weeks at 9 years, then steps down to 12 weeks at 10 or more, a quirk carried over from the 2004 Redundancy Case. It is paid at the base rate, on top of notice. Employers with fewer than 15 employees pay nothing under the NES, though some industry awards override that.
- Range4 to 16 weeks' base pay
- At 10+ years12 weeks (the scale steps down)
- Qualifying service12 months
- Small business exemptionFewer than 15 employees
| Length of service | Entitlement |
|---|
| 1 to under 2 years | 4 weeks |
| 2 to under 3 years | 6 weeks |
| 3 to under 4 years | 7 weeks |
| 4 to under 5 years | 8 weeks |
| 5 to under 6 years | 10 weeks |
| 6 to under 7 years | 11 weeks |
| 7 to under 8 years | 13 weeks |
| 8 to under 9 years | 14 weeks |
| 9 to under 10 years | 16 weeks |
| 10 years or more | 12 weeks |
- Frequently misquoted as '16 weeks at 10+ years'; the drop to 12 is real.
- Building, coal and some other industry awards run their own schemes over the top.
Source: Fair Work Ombudsman (NES, Fair Work Act s.119). Checked July 2026.
Canada
Ontario runs two separate ESA entitlements that people constantly merge: termination pay (the notice entitlement above) and severance pay. Severance is one week's wages per year of service, pro-rated for part years and capped at 26 weeks, owed only where the employee has 5 or more years and the employer's global payroll reaches C$2.5 million. Both can be owed on the same dismissal. The federal version is far smaller: the greater of 2 days' wages per year or 5 days.
- Ontario formula1 week per year (pro-rated), cap 26 weeks
- Dual test5+ years' service AND C$2.5M+ global payroll
- StackingPaid on top of termination notice or pay in lieu
- FederalGreater of 2 days per year or 5 days' wages
| Length of service | Entitlement |
|---|
| Under 5 years | Nil |
| 5 years or more (payroll test met) | 1 week per year + 1/12 per extra month, cap 26 weeks |
- The C$2.5M test is global payroll, not Ontario payroll, settled by Hawkes v. Max Aicher (2021).
- Common-law reasonable notice can dwarf both ESA amounts; we state the statutory floor only.
Source: Ontario ESA guide (Global-payroll reading per 2021 caselaw). Checked July 2026.
New Zealand
New Zealand mandates process, not payment: a genuine business reason, good-faith consultation, redeployment considered, and contractual notice. If the agreement has no redundancy clause, no compensation is owed. A flawed process can still ground an unjustified dismissal claim even though no redundancy payment applies.
- Statutory redundancy payNone
- What is requiredGenuine reason, consultation, notice per the agreement
- Final pay must still include unused annual holidays and other accrued entitlements.
Source: Employment New Zealand (Employment Relations Act 2000). Checked July 2026.
Singapore
Retrenchment benefit in Singapore depends on the contract or collective agreement; where neither provides for it, the amount is negotiated. MOM's guidance puts the prevailing norm at 2 weeks to one month per year of service, with 2 years' service the usual eligibility line and shorter-serving staff handled ex gratia. Employers with 10 or more employees must notify MOM of every retrenchment within 5 working days.
- Statutory entitlementNone (advisory norm)
- Prevailing norm2 weeks to 1 month of salary per year of service
- Usual eligibility2 years' service
- MOM notificationMandatory for employers with 10+ staff
- Never present the norm range as a legal minimum; it is not one.
- The old 'only notify if 5+ retrenched' rule is outdated; since Nov 2021 every retrenchment at a 10+ employee firm is notifiable.
Source: Ministry of Manpower (Tripartite advisory; notification regime since Nov 2021). Checked July 2026.
United Kingdom
Statutory redundancy pay uses three age bands: half a week per year under 22, one week per year from 22 to 40, and one and a half weeks per year at 41 plus. Service counts up to 20 years, weekly pay is capped at £751 for 2026-27, and the ceiling works out at £22,530. Two years' service is the qualifying line, unchanged by the Employment Rights Act 2025.
- Formula0.5 / 1 / 1.5 weeks per year by age band
- Weekly pay cap£751 (2026-27)
- Maximum£22,530
- Qualifying service2 years
| Length of service | Entitlement |
|---|
| Years worked under age 22 | 0.5 week's pay per year |
| Years worked aged 22 to 40 | 1 week's pay per year |
| Years worked aged 41 plus | 1.5 weeks' pay per year |
- ERA 2025 doubled the collective-consultation protective award to 180 days' pay, so process failures now cost far more than the redundancy pay itself.
- Redundancy pay is tax-free up to £30,000.
Source: GOV.UK (Caps from 6 Apr 2026). Checked July 2026.
United States
The Fair Labor Standards Act has no severance requirement, and the Department of Labor says so in exactly those terms. Severance in the US comes from employment agreements, severance plans (enforceable under ERISA once promised) or collective agreements. WARN's teeth are back pay for missing notice, up to 60 days, not a severance formula.
- Federal statutory severanceNone
- WARN liability for missed noticeUp to 60 days' back pay and benefits
- 'Two weeks per year of service' is common US practice, but it is policy, not law.
- New Jersey's mini-WARN is the notable state exception, mandating severance for large layoffs.
Source: US Department of Labor (FLSA position, current). Checked July 2026.
Plain-English definitions in the HR Glossary: redundancy pay, severance package, statutory redundancy pay, termination severance ontario, employment termination payment.
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