Redundancy Pay Calculator Australia 2026 — How Much Are You Entitled To?
Use our free redundancy pay calculator to work out exactly how much redundancy pay you're entitled to in Australia. Covers NES minimums, service periods, tax-free thresholds, and what to do if your employer won't pay.
How Redundancy Pay Is Calculated in Australia
Redundancy pay in Australia is calculated based on your continuous period of service with your employer. Under the National Employment Standards (NES), the minimum redundancy entitlement is set out in a sliding scale. For 1 to 2 years of service you receive 4 weeks' pay. For 2 to 3 years it increases to 6 weeks. Service of 3 to 4 years entitles you to 7 weeks, 4 to 5 years gives 8 weeks, 5 to 6 years provides 10 weeks, 6 to 7 years equals 11 weeks, 7 to 8 years earns 13 weeks, 8 to 9 years provides 14 weeks, and 9 to 10 years entitles you to 16 weeks. For 10 years or more of continuous service you receive 12 weeks — this reduction reflects the availability of long service leave at that point. A week's pay means your base rate of pay for ordinary hours worked, excluding overtime, penalties, allowances, and bonuses. If you are a full-time employee working 38 hours per week at $35 per hour, one week's pay is $1,330. If you had 6 years of service, your minimum NES redundancy would be 11 weeks × $1,330 = $14,630. Your enterprise agreement or employment contract may provide more generous redundancy entitlements — always check these documents first as they can only improve on, not reduce, the NES minimums.
Who Is Entitled to Redundancy Pay?
Not every employee who loses their job is entitled to redundancy pay. To qualify under the NES, you must be a permanent employee (full-time or part-time) who has completed at least 12 months of continuous service. Your role must be genuinely redundant — meaning the employer no longer needs the job to be done by anyone, or the employer becomes insolvent or bankrupt. Casual employees are not entitled to redundancy pay under the NES regardless of how long they have worked, though some enterprise agreements may provide redundancy entitlements for long-term casuals. Employees of small businesses (fewer than 15 employees at the time of dismissal) are also excluded from the NES redundancy pay provisions, although an award or agreement may still require it. Fixed-term contract workers, seasonal workers, and employees terminated for serious misconduct are similarly excluded. If you are an apprentice or trainee whose employment ends at the conclusion of the training arrangement, redundancy pay generally does not apply. If you believe your redundancy was not genuine — for example, your role was simply given to someone else — you may have grounds for an unfair dismissal claim instead.
Tax-Free Redundancy Pay — Genuine Redundancy Thresholds 2025-26
One significant financial advantage of a genuine redundancy is the tax-free component. The ATO sets a tax-free limit each financial year that applies to genuine redundancy payments. For 2025-26, the tax-free amount is a base limit of $12,524 plus $6,264 for each completed year of service. For example, if you had 8 completed years of service, your tax-free amount would be $12,524 + (8 × $6,264) = $62,636. Any amount above this threshold is taxed as an employment termination payment (ETP), which receives concessional tax treatment up to certain caps depending on your age. Amounts within the ETP cap are taxed at a maximum of 15% (plus Medicare levy) if you are over preservation age, or 30% (plus Medicare levy) if under preservation age. To qualify as a genuine redundancy, the dismissal must not be because of the employee's personal conduct, capacity, or performance. The employer must have made a definite decision that the position is no longer required, and the employer must comply with any consultation obligations in the relevant award or enterprise agreement. If the ATO determines the redundancy was not genuine, the entire payment is taxed as an ETP with no tax-free component. Always seek advice from a registered tax agent to maximise your after-tax position.
What If Your Employer Refuses to Pay Redundancy?
If your employer refuses to pay your redundancy entitlement, you have several avenues to pursue. First, put your request in writing and reference the specific NES provisions, award, or enterprise agreement that entitle you to redundancy pay. Give the employer 7 days to respond. If they still refuse, you can lodge a complaint with the Fair Work Ombudsman (FWO) online at fairwork.gov.au. The FWO can investigate and, if necessary, take enforcement action including issuing compliance notices or pursuing the matter in court. If the dispute is about whether the redundancy was genuine or whether the NES applies, you can apply to the Fair Work Commission (FWC) for assistance. The FWC can also vary the amount of redundancy pay in certain circumstances — for example, reducing it if the employer finds you other acceptable employment or if paying the full amount would cause the employer serious financial hardship. If your employer is insolvent or bankrupt, you may be eligible for assistance through the Fair Entitlements Guarantee (FEG), a government scheme that covers unpaid wages, leave, and redundancy pay up to a capped amount. FEG claims must be lodged within 12 months of the date of termination. Time limits apply to all claims, so act quickly — unfair dismissal applications must be made within 21 days of dismissal.
Redundancy Pay vs Other Final Pay Entitlements
Redundancy pay is only one component of what you should receive when your employment ends. Your final pay should also include payment for any untaken annual leave (including leave loading if applicable under your award or agreement), any untaken long service leave if you have reached the qualifying period, payment for the notice period (or payment in lieu if the employer does not require you to work out notice), and any outstanding wages, overtime, or allowances owed up to your last day. Your employer must pay all final entitlements within 7 days of termination, or by the next regular pay cycle — whichever is earlier. Superannuation must also be paid on ordinary time earnings up to your final day. Keep copies of all your payslips, your employment contract, any redundancy letter, and your final payslip. If there are discrepancies, raise them immediately. Use a redundancy pay calculator to estimate your total entitlements before your final meeting with your employer — being informed puts you in a much stronger negotiating position, particularly if your employer offers a redundancy package above the NES minimum.
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General information and estimates only — not legal, financial, or tax advice. Always verify with the Fair Work Ombudsman (13 13 94) or a qualified professional.
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