Are you over 50 and facing the prospect of redundancy? You're right to wonder how the redundancy pay rules apply to you. The rules have changed considerably in recent years, and what used to apply to older employees no longer applies automatically. In this article, you'll find out exactly what you're entitled to in 2026 and what opportunities are still available to you.
What has changed for older employees
Until 1 January 2020, employees aged 50 or over with at least ten years of service received a higher redundancy payment than their younger colleagues. That enhanced accrual was abolished with the introduction of the Labour Market in Balance Act (WAB). Since then, the same calculation method applies to everyone: 1/3 of gross monthly salary for each full year of service, regardless of age.
This means that employees in their 50s and 60s now receive the same redundancy pay as younger employees. If you have been with an employer for a long time, you simply accrue more under that fixed formula — age no longer plays any role in it.
How to calculate redundancy pay in 2026
The calculation is the same for all employees. The amount of redundancy pay depends on two factors: your gross monthly salary and your total length of service. For each full year of service, you receive 1/3 of your gross monthly salary. Any remaining months and days are calculated on a pro-rata basis.
For example: you are 58 years old, have worked for the same employer for 22 years, and earn €4,000 gross per month including holiday allowance. The calculation would look like this:
- €29,333.33 €29,333 Gross redundancy pay
That is a substantial sum — and it shows that a long period of service works in your favour as an older employee when it comes to the calculation, even though the special over-50s rule has been abolished.
The statutory maximum in 2026 is €102,000 gross. If you earn more than €102,000 per year, your gross annual salary serves as the upper limit.
No entitlement to redundancy pay upon reaching state pension age
There is one important exception to bear in mind: if you reach state pension age and are dismissed on that basis, you are not entitled to a redundancy payment. This exception is separate from the general dismissal rules and applies specifically to situations where reaching pensionable age is the direct reason for the end of the employment contract. If you are dismissed before reaching that age, the normal rules apply to you in full.
More opportunities than you might imagine as an older employee
Although the enhanced statutory accrual no longer exists, that does not mean you cannot negotiate a better deal as an older employee. Particularly when dismissal takes place by means of a settlement agreement, there is often more on the table than the statutory minimum payment. Consider the following:
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Plan a conversation- Compensation for pension loss: Your pension accrual stops when you are dismissed. That loss is real and can form part of the negotiation.
- Extended notice period: request a longer notice period, giving you more time to find new work or to prepare for the transition properly.
- Outplacement support good support in finding a new position is valuable, particularly if the job market is somewhat more challenging for your age group.
- Payment of outstanding holiday days and accrued entitlements Ensure all accrued entitlements are fully included in the settlement terms.
- Higher severance payment through negotiation The statutory redundancy payment is a floor, not a ceiling. When agreeing a settlement agreement, you are always free to agree on more.
Bear in mind that if the grounds for dismissal are not properly substantiated – or if multiple reasons are in play – there may be grounds for a higher payment or even a fair compensation award on top of the redundancy payment. This does, however, require a thorough legal analysis of your specific situation.
What counts towards the gross monthly salary
When calculating redundancy pay, it is not just your basic salary that is taken into account. Fixed allowances, holiday pay (8%) and any fixed year-end bonus (1/12 per month) are also included. Variable bonuses are averaged over the last three years. If you feel that your employer has not included all components, always have the calculation checked before you agree to anything.
Would you like to know more about the general rules on this subject? Take a look at the page on Redundancy Pay For a complete overview.
Practical tips for older employees facing redundancy
- Never agree too quickly to your employer’s first proposal — it is almost always negotiable.
- Ensure that your entire period of service has been accurately considered, including any previous contracts with the same employer.
- Assess your pension loss before signing a settlement agreement.
- Ask for written substantiation of the grounds for dismissal; if this is absent, your position is stronger.
- Make full use of the statutory 14-day cooling-off period after signing a settlement agreement.
- Engage an employment lawyer in good time — ideally before you sign anything.
Why Labour Lawyer Eindhoven
At Arbeidsjurist Eindhoven, we understand how significant redundancy is, particularly when you have dedicated many years of hard work to an employer. We know the local job market in Eindhoven and the Brabant region and are happy to think through what is achievable in your situation. Whether it is reviewing a settlement agreement, calculating the correct redundancy pay, or conducting a firm negotiation with your employer: we are by your side. Get in touch with us without any obligation – we are delighted to help.
Frequently asked questions
Do I receive higher redundancy pay than my younger colleagues as someone over 50?
No, not automatically. The special enhanced accrual for employees over 50 was abolished on 1 January 2020. In 2026, the same calculation will apply to everyone: 1/3 of gross monthly salary per full year of service. However, if you have been with your employer for a long time, your length of service will still result in a relatively high redundancy payment.
The maximum statutory redundancy pay is capped at €17,187.
The statutory maximum redundancy payment in 2026 is €102,000 gross. If you earn more than €102,000 per year, your gross annual salary serves as the upper limit. This maximum is indexed annually in line with the development of contractual wages.
Am I entitled to redundancy pay as an older employee if I am dismissed upon reaching state pension age?
No. If you are dismissed because you have reached state pension age, you are not entitled to a redundancy payment. If your dismissal is for a different reason and takes place before you reach that age, the normal rules apply and you are entitled to redundancy pay.
Yes, you can certainly negotiate more than just the statutory redundancy payment as an older employee.
Yes, absolutely. The statutory redundancy payment is a minimum, not a maximum. Particularly in the context of a settlement agreement, there is scope to agree additional terms, such as compensation for pension loss, a longer notice period, or outplacement support. An employment lawyer can help you assess what is realistic and achievable in your situation.
Which pay components are included when calculating redundancy pay?
In addition to your basic salary, holiday pay (8%), a fixed year-end bonus (1/12 per month) and fixed allowances are also included. Variable bonuses are averaged over the last three years. It is important to check that your employer has correctly included all components in the calculation.
We're happy to help you brainstorm ideas. For advice tailored to your specific situation, we'd be happy to sit down with you. No rights can be derived from the content of this page and it may contain inaccuracies.
