Rule · ERA 1996 s.162

The 0.5 / 1 / 1.5 age-band formula

The age you were during each year of service decides how that year is weighted. Years late in your career are worth more because the legislation assumes older workers find it harder to retrain.

Age-band formula (ERA 1996 s.162)

1.5 wkAge 41 and overEach complete year of service in this band

1.0 wkAge 22 to 40Each complete year of service in this band

0.5 wkUnder age 22Each complete year of service in this band

How the bands are counted

Years are counted backwards from the termination date. For each complete year of service, the "age during the year" is your age at the start of that year. So for a 47-year-old leaving in June, the most recent year was at age 46-47 (1.5 weeks band). The year before that was 45-46 (still 1.5). Walk back until you hit 41, then drop to the 22-40 band.

Fractional years are ignored. Only complete years count. A worker with 12 years and 11 months gets 12 years of credit.

Why this is not age discrimination

The age bands look discriminatory but were specifically exempted from the age-discrimination rules by EE(Age) Regs 2006 reg.33. The justification accepted by Parliament was that statutory redundancy is a compensation-for-loss-of-employment scheme, and older workers face greater re-employment difficulty. The exemption now lives in Schedule 9 of the Equality Act 2010 in updated form.

Worked example

Worker is 47, leaves after 12 complete years of service, gross weekly pay £600. Bands fall as: 7 years at age 41+ (1.5 wk) and 5 years at 22-40 (1 wk). Total weeks = 10.5 + 5 = 15.5. Pay = 15.5 × £600 = £9,300. Because £600 is under the £751 cap, no capping flag is raised.