How notice periods work under the NES
The National Employment Standards set the minimum notice an employer must give when they end your employment. It scales with your continuous service: 1 week under a year, 2 weeks for 1 to 3 years, 3 weeks for 3 to 5 years and 4 weeks beyond 5 years. If you are over 45 and have clocked at least 2 years, you get an extra week on top. An employer can ask you to work the notice, or pay it out as pay in lieu of notice, which is your notice weeks times your weekly pay.
How redundancy pay is calculated
Redundancy pay is separate from notice and follows its own NES scale. It starts at 4 weeks for 1 to 2 years of service and climbs to 16 weeks at 9 to 10 years, then drops back to 12 weeks once you pass 10 years. There is no redundancy pay under 1 year of service. A small business, meaning fewer than 15 employees, is generally exempt from paying NES redundancy, though notice of termination still applies. Casuals and some fixed-term and seasonal employees are excluded as well. Your award or enterprise agreement can set higher amounts, so treat these as the floor.
Notice plus redundancy, together
When a role is made redundant you can be owed both notice and redundancy pay. On 6 years of service at $1,500 a week, that is 4 weeks' notice ($6,000) plus 11 weeks' redundancy ($16,500), a combined $22,500 before tax. Redundancy amounts are often taxed as an employment termination payment, with part of a genuine redundancy tax-free, so the amount that lands in your account can differ from the gross figure here.
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Simon is the founder of Orbit Money, a tool that helps people track subscriptions and recurring spend. He builds Orbit's free money calculators and writes about personal finance for Australian and UK readers.
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