Redundancy pay is calculated based on your age, length of service and your weekly pay. There are statutory minimums that your employer must pay you, but they may offer more as part of your employment contract or company policy. Here's a breakdown of how it's typically calculated: Age: The amount you receive varies depending on your age group. Length of Service: The longer you've been employed, the more redundancy pay you'll generally be entitled to. Weekly Pay: There's usually a cap on the weekly pay that is used for calculating redundancy pay. Statutory Redundancy Pay: The statutory minimums are set by law. As of the latest information, for each completed year of service, you are entitled to: Half a week's pay if you are aged 16 to 21. One week's pay if you are aged 22 to 40. One and a half week's pay if you are aged 41 or over. This calculation is capped based on the current maximum weekly pay in the UK, which changes annually. Additional Pay: Contractual Redundancy Pay: Your employment contract or company handbook might outline a more generous redundancy pay scheme than the statutory minimum. If so, your employer is legally obliged to honour this. Payment in Lieu of Notice: If your employer doesn't want you to work your notice period, they must pay you for it. This is separate from your redundancy pay. Outstanding Holiday Pay: You are also entitled to be paid for any accrued but unused holiday days. How to find out the exact amount: 1. Check your employment contract or company handbook: This is the first place to look for any contractual redundancy pay terms. 2. Ask your employer: Your employer should be able to provide you with a detailed breakdown of your redundancy pay calculation. 3. Use an online calculator: Many government and employment law websites offer redundancy pay calculators that can give you an estimate. For example, the UK government's website has a statutory redundancy pay calculator. It's important to speak to your employer directly or consult with an employment advisor if you have any specific questions or believe your redundancy pay has been calculated incorrectly.

How is the amount of the transition payment determined?

Are you about to face dismissal and wondering how much your transition payment will be? The amount of the transition payment is not a fixed sum: it is calculated on the basis of your personal circumstances. In this article you will find exactly which factors count, what the statutory maximum is in 2026, and when there is scope for more.

The two pillars of the calculation

The amount of the transition payment depends on two concrete figures: your gross monthly salary and the length of your period of employment. Both factors are set out in statute in Article 7:673 of the Dutch Civil Code. The basic rule is straightforward: you receive one third of a gross monthly salary for each full year of service. For any part of the employment that falls short of a full year, the payment is calculated on a pro-rata basis.

Suppose you have been employed for twelve years with a gross monthly salary of € 3,500 including holiday allowance. You would then receive 12 × 1/3 × € 3,500 = € 14,000 for those twelve complete years. Any remaining months and days are added on top of that on a pro-rata basis.

What counts towards the gross monthly salary

The gross monthly salary is broader than just your basic base salary. Several fixed pay components must be taken into account when calculating it. These include:

• Holiday allowance (the standard 8% of gross monthly salary)
• A fixed year-end bonus or thirteenth month (1/12 per month)
• Structural shift allowance or a fixed overtime allowance
• A fixed bonus or profit share that is paid out on a regular basis

Variable or incidental remuneration is treated differently from structural components. Not sure whether a particular allowance counts? It is worth having this checked, as an error in the basis of calculation can noticeably affect the total payment.

The statutory maximum in 2026

Er geldt een wettelijk plafond. Per 1 januari 2026 bedraagt de transitievergoeding maximaal € 102.000 bruto. Verdien je meer dan € 102.000 per jaar? Dan geldt jouw bruto jaarsalaris als bovengrens. Dit maximum wordt jaarlijks geïndexeerd op basis van de ontwikkeling van de contractlonen; in 2025 lag de grens nog op € 98.000.

That cap sounds definitive, but it is not always the case. If your employer has acted seriously culpably, the subdistrict court may, in addition to the transition payment, also award a supplementary fair compensation. In that situation there is no statutory maximum. You can find more about your rights on dismissal on the page transition payment.

Illness and leave have no effect

A question that often arises: does a period of illness or leave count towards the calculation? The answer is yes, and in your favour. Years of service during illness or leave count in full. Moreover, the payment is calculated on the basis of the salary you would have earned without that illness or leave, not on the basis of any reduced sickness benefit. Illness or leave therefore has no negative effect on the amount of your transition payment.

Deductions your employer may apply

Under strict conditions, an employer may deduct certain costs from the transition payment. This applies exclusively to costs that were incurred specifically with a view to the transition, such as:

• Costs for outplacement support
• Training aimed at work outside the organisation
• Release from work duties during an extended notice period, provided this has been agreed by mutual consent

Costs relating to reintegration, performance improvement or support within the employee's own role may not be deducted. Always check whether the deductions your employer puts forward genuinely meet the statutory requirements.

When can you receive more than the statutory minimum

The statutory transition payment is a floor, not a ceiling for negotiation. Particularly in the case of dismissal via a settlement agreement, there is in practice often scope for a higher payment. Employers deliberately choose the faster route of a mutual arrangement and are sometimes prepared to pay a higher severance payment for it. You have three weeks to reconsider after signing a settlement agreement, but it is best to negotiate before you sign.

Practical tips for getting the most out of your situation:

• Check that all fixed salary components have been correctly included in the calculation
• Verify whether your employer is deducting costs that they are not actually permitted to deduct
• Ask a specialist employment lawyer to review the calculation before you agree to it
• Negotiate a higher payment if the employer wishes to avoid the UWV or subdistrict court procedure
• Be alert to the possibility of a fair compensation (billijke vergoeding) if your employer has acted in a culpable manner

Why Employment Lawyer Eindhoven

At Arbeidsjurist Eindhoven, we understand that behind every dismissal file there is a personal story. We do not only check whether the figure is arithmetically correct, but also whether there is scope for a better outcome in your specific situation. Whether you work in Eindhoven, Helmond or anywhere else in the Brabant region: we are here for you with clear, practical guidance. Contact us without obligation and find out what we can do for you.

Frequently asked questions

How much is the transition payment in 2026?

In 2026, the transition payment amounts to a maximum of €102,000 gross. If you earn more than €102,000 per year, your gross annual salary serves as the maximum. The exact amount depends on your monthly salary and the length of your employment: you receive 1/3 of a gross monthly salary for each full year of service.

Which salary components are taken into account when calculating the transition payment?

In addition to your basic salary, holiday allowance (8%), a fixed year-end payment (1/12 per month), structural supplements and regular bonuses are also taken into account. Incidental or variable remuneration is assessed differently. Have any doubtful cases reviewed by an employment lawyer.

Does my illness affect the amount of my transition payment?

No. Periods of illness or leave count normally as years of service. The calculation is based on the salary you would have earned had you not been ill, not on any reduced sick pay. Illness therefore has no adverse effect on the amount of your transition payment.

Can my employer deduct costs from the transition payment?

This is only permitted under strict conditions. Costs for outplacement or training aimed at other employment may be deducted, provided they were incurred by mutual agreement and are directly related to the dismissal. Costs for reintegration or performance improvement within the employee's own role may not be deducted.

Can I receive more than the statutory transition payment?

Yes. The statutory transition payment is a minimum. Through negotiation, for example in the context of a settlement agreement, a higher payment is possible. Furthermore, in cases of serious culpable conduct by the employer, the court may award an additional fair compensation, for which no statutory maximum applies.

We are happy to think along with you. For advice tailored to your situation, we would be glad to talk. No rights can be derived from the content of this page and it may contain inaccuracies.