A week's pay

A single defined term does most of the arithmetic behind an unfair dismissal or redundancy claim — but it is not always your gross weekly wage, and whether it is capped depends entirely on what you are calculating.

Is a week's pay just my gross weekly salary?

Not always. If you have normal working hours and fixed pay, a week's pay is simply that fixed weekly amount. But if your pay varies with the amount of work you do, or you have no normal working hours at all (genuinely casual or zero-hours work), a week's pay is worked out by averaging your pay over a reference period rather than by reading a single figure off a payslip.

What reference period is used to average variable pay?

Twelve weeks, under Employment Rights Act 1996 sections 221(3) and 224. This is easy to get wrong because a different reform extended a different reference period, for a different purpose, from 12 to 52 weeks in April 2020 — but that change applies to holiday pay under the Working Time Regulations 1998, not to the week's pay definition used for redundancy pay, notice pay and the basic award. Those still use a 12-week average.

Is a week's pay capped at a fixed amount?

Only for some purposes. The cap (currently £751, reviewed every April) applies to the basic award, to statutory redundancy pay, and to the additional award for non-compliance with a reinstatement order. It does not apply to statutory notice pay, which uses your real, uncapped week's pay.

Why isn't notice pay capped in the same way?

Because it comes from a different part of the Employment Rights Act 1996. Notice pay is set by sections 86 to 91, which borrow the week's pay definition in sections 220 to 229 but do not borrow the cap in section 227. The cap in section 227 is written to attach specifically to the basic award, redundancy payments and the additional award — nothing in the statute extends it to notice.

What if my hours and pay change every week?

If you have no normal working hours, section 224 averages your weekly remuneration over the 12 weeks ending with the calculation date. If a week in that window had no remuneration payable, it is skipped and an earlier paid week is brought in instead, so the average is always taken across 12 weeks in which you actually earned something.

Does the same week's pay figure feed into more than one calculation?

Yes. The same definition in sections 220 to 229 underpins statutory redundancy pay, the basic award, the additional award, and statutory notice pay. What differs between them is not how a week's pay is defined, but whether the cap in section 227 is layered on top of it once that figure has been worked out.

The three ways a week's pay is worked out

“A week's pay” sounds like it should mean one thing, but the Employment Rights Act 1996 actually gives three different methods, and which one applies to you depends on your working pattern — not on which claim you are bringing.

Normal working hours, fixed pay (s.221(2)).

If you work set hours each week and your pay for those hours does not change with output, a week's pay is simply the amount payable under your contract for a normal week, as it stands on the relevant calculation date. There is nothing to average — you take the figure your contract specifies.

Normal working hours, variable pay (s.221(3)–(4)).

If you work set hours but your pay varies with the amount of work done — piece rates, output-linked bonuses, sales commission that forms part of your normal remuneration — a week's pay is your average hourly rate over the 12 weeks ending with the calculation date, multiplied by your normal weekly hours. The same averaging principle applies under s.222 where pay varies according to the time of work rather than the amount — for example, differently-paid shifts on a rota.

No normal working hours (s.224).

If your working pattern is genuinely casual — no fixed rota, hours that fluctuate week to week with no baseline — a week's pay is your average weekly remuneration over the 12 weeks ending with the calculation date. Section 226 fills in the detail: any week in that 12-week window where no remuneration was payable is skipped and an earlier paid week is substituted, so the average always reflects 12 weeks in which you actually earned something, not 12 calendar weeks regardless of pay.

The “calculation date” itself is fixed by ss.225–226 and varies depending on which right is in play — broadly, for a dismissal it tracks the date notice was given or the effective date of termination, not the date of a tribunal hearing or the date you happen to be doing the sum. Getting the calculation date wrong can pull in an entirely different set of weeks for anyone on variable pay, so it is worth checking rather than assuming today's pay applies.

The reference period: still 12 weeks, not 52

This is one of the more common places general commentary online gets a week's pay wrong, because a genuine 12-to-52-week change did happen in UK employment law — just not to this definition.

From 6 April 2020, the Employment Rights (Employment Particulars and Paid Annual Leave) (Amendment) Regulations 2018 extended the reference period for averaging a worker's pay from 12 weeks to 52 weeks. That change amended regulation 16 of the Working Time Regulations 1998 — it is specifically about calculating holiday pay for workers with irregular hours or pay. It did not touch the Employment Rights Act 1996 at all.

Sections 221(3) and 224 of the 1996 Act — the provisions that average pay for statutory redundancy pay, the basic award, the additional award and statutory notice pay — still use a 12-week reference period. The two schemes share a similar mechanism (average pay over a look-back window to smooth out variable earnings) and happened to converge on the same “12 weeks” starting point before 2020, which is presumably how the two get conflated. They are separate statutes, serving separate purposes, and only one of them moved.

Capped for some calculations, uncapped for others

Once you have worked out what a week's pay actually is for your circumstances, the next question is whether a ceiling applies to it — and the answer depends entirely on what you are calculating, not on how the figure itself was derived.

Section 227 caps a week's pay, currently at

and reviewed every April by statutory instrument, for three purposes only:

Statutory notice pay is not on that list.

Sections 86 to 91 of the same Act set the minimum notice period and pay for it, and they use the week's pay definition in ss.220–229 — but nothing in ss.86–91 imports the s.227 cap. If your real week's pay is above the cap, your notice pay is still calculated on your real, uncapped figure. The compensatory award for unfair dismissal is different again: it is not calculated from “a week's pay” at all, but from your actual financial loss, subject to its own separate statutory cap under s.124.

This distinction matters in practice because it is easy to compute a week's pay once, apply the s.227 cap to it because that is the figure that happens to be closest to hand, and then reuse that same capped number for notice pay without checking whether the cap should have applied there at all. That exact mistake has previously been shipped in more than one calculator: a capped week's pay figure being carried across into a notice pay calculation, understating notice pay for anyone earning above the cap. The fix is structural, not arithmetical — keep the capped and uncapped figures as two separate values from the point they diverge, and only apply the cap where s.227 actually says to.

Marcus is 42 and has 8 complete years' service. His real gross week's pay, worked out under s.221(2) because he has normal working hours and fixed pay, is

— above the £751 cap. He is made redundant.

Statutory redundancy pay.

His 8 years of service, counted back from termination, fall across two age bands: one year attributed to age 41 (multiplier 1.5) and seven years attributed to ages 40 down to 34 (multiplier 1.0), giving

weeks' pay. Because his real

exceeds the cap, the calculation uses the capped figure of

Weeks earned (age-banded)

Week's pay used (capped)

Statutory redundancy pay

Statutory notice pay.

Separately, with 8 complete years of service Marcus is due a minimum of

weeks' statutory notice under s.86. Notice pay uses his real, uncapped week's pay — the same

figure the cap was applied to above, but this time without the cap.

Week's pay used (uncapped)

The same person, the same real week's pay of

— but one calculation is deliberately capped by statute and the other is not. A calculator that applied the

capped figure to Marcus's notice pay would understate it by

Employment Rights Act 1996, ss.220–229 (Part XIV, Chapter II)

Employment Rights Act 1996, s.227

Employment Rights Act 1996, ss.86–91

Employment Rights (Increase of Limits) Order 2026 (SI 2026/310)

Working Time Regulations 1998, reg.16

Employment Rights (Employment Particulars and Paid Annual Leave) (Amendment) Regulations 2018 (SI 2018/1378)

Calculate your redundancy pay

A week's pay — Employment Tribunal Glossary

What counts as "a week's pay" under the Employment Rights Act 1996, why the weekly pay cap applies to redundancy pay and the basic award but not to notice pay, and the correct 12-week averaging rule for variable pay.