Top Tips on How to Negotiate a Redundancy Package

Written by Calvin Bowers
Last updated October 12, 2021

If you are facing redundancy, then the chances are that you have a lot of questions. How much money can I get? Who can I talk to? What are my rights? These are just a few of the many questions that may be on your mind. It’s a daunting and stressful time, so knowing how to negotiate a redundancy package can put your mind at ease and set you up for future employment opportunities.

In this blog post, we’ll explain what a redundancy package is, what to expect when receiving one, and give you some top tips for negotiating the very best deal with your employer.

What Is a Redundancy Package?

A redundancy package, also known as a severance package, is a form of compensation offered to employees who are being made redundant or laid off from a company. The goal of a redundancy package is to ease the financial hardship and transition stress for employees who are losing their jobs through no fault of their own. It provides a cushion while the employee seeks new employment. In general, the longer you work for a company, the larger your redundancy package will be.

What Does a Redundancy Package Contain?

A redundancy package commonly contains the following:

Redundancy pay

Redundancy pay is the legislated pay for an employee who is being made redundant. The amount is set by law and is, therefore, public knowledge. It is the basic amount due to someone facing redundancy.

Severance pay

This is compensation paid to an employee due to loss of benefits. The amount is decided privately between the employer and employee and can be increased by bonuses, commission payments, shares, and more.

Career transition support

Outplacement counselling, or career transition support, is offered to help you find your next role. This is particularly useful if you are struggling to find employment in this competitive job market. It can also provide an opportunity for career guidance and the chance to update your skills or qualifications.

Lateral movement

Many companies will present the opportunity for lateral movement. With this, you could either:

  • move into a new role with your existing employer or, 
  • move to another company within their group if a job is available. 

You do not have to accept this option if it’s presented to you. Nevertheless, it can be beneficial as you will not experience any gaps in employment, which could affect future career prospects.

Training and development opportunities

Training and development opportunities can help you keep your skills up to date. being offered these opportunities can also provide a positive indication of future progression within the company.

Exit package

An exit package is designed to provide further financial support or benefits for those with families or dependents. These may include childcare vouchers, legal advice on redundancy pay, special discounts or offers for health insurance.


Many redundancy packages will include work references and letters of support to back up your skills and experience when you’re looking for a new role. This is particularly useful if it includes client testimonials. These can help with future employment prospects and showcase how effective you were at the job on a day-to-day basis.

How to Negotiate a Redundancy Package

Now that we know exactly what a redundancy package may contain, let’s dive into our top tips for successfully negotiating a redundancy package.

Tip 1

Research online and in our Redundant Workers Hub to find the current statutory redundancy pay rates and eligibility rules based on age, length of employment, etc. For example, the statutory cap is currently £19,290 even for long servings. Understanding legal minimums gives you confidence in what to reasonably request or refuse in an enhanced deal.

Tip 2

Consider whether you’d prefer slightly higher monetary compensation, career transition support or more paid time off to job hunt. Identifying what matters most means you can better judge trade-offs rather than having an uncompromising ideal package.

Tip 3

Compile copies of past performance reviews, sales numbers showing your contribution, emails praising your work, records of promotions with increased responsibilities over the years, etc. These help justify arguing for a bigger payout because they demonstrate the value you brought to the role.

Tip 4

Independent redundancy negotiation services can provide guidance tailored to your situation on precedents in your industry and skill level. Speaking to HR professionals in your network can also reveal what enhanced elements like time off or training budgets could be feasibly negotiated in your field.

Tip 5

Before stating what package you want, politely ask your employer what the overall budget is allocated by HR for redundancy settlements this round. If told, this gives you an idea of the financial limitations to work within.

Tip 6

Practice at home and professionally outline why you deserve an enhanced severance package e.g. consistently positive appraisals, and training newer team members. Remember to avoid confrontation but firmly justify yourself.

Redundant Workers Support Hub

Here at Refreshing a Career, we aim to connect willing workers with the right employers. So, if you’re facing redundancy, we’re here to support you and help you on your way to finding your next dream career. Knowing how to negotiate a redundancy package is just the first step!

If you’d like to learn more about how to prepare for redundancy, what extra support is available, and much more, visit our dedicated Redundancy Support Hub.

You’ll find a wealth of support and resources, as well as job application and CV writing tips. Check out our redundant workers jobs board for the latest opportunities near you!

Don’t forget to subscribe to our free newsletter below or contact our team for further support.

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Last Updated: Wednesday January 10 2024
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