Losing your job feels the same either way, but in UK employment law, "redundancy" and "unfair dismissal" are legally distinct — and mixing them up can mean settling for far less than you're owed, or missing a claim entirely.
Redundancy happens when a role stops being needed — the business is closing, a site is shutting, or the work itself has genuinely disappeared. It's about the position, not the person. If it's handled properly (fair selection, proper consultation, correct notice), a genuine redundancy is lawful, and you're entitled to statutory redundancy pay if you have 2+ years' service.
Unfair dismissal is about the person, not the role. It covers situations where you're dismissed without a fair reason, without a fair process, or where "redundancy" is actually being used as cover for something else — for example, selecting you for redundancy because of your age, a recent grievance, or maternity leave, rather than genuine business need. Most unfair dismissal claims require at least 2 years' continuous service, though there are important exceptions (for example, dismissal related to pregnancy or whistleblowing can be claimed from day one).
A genuine redundancy only entitles you to the statutory (or contractual) redundancy payment — see our redundancy pay calculator. An unfair dismissal claim, if successful at an employment tribunal, can result in significantly higher compensation, including for lost earnings, on top of anything else you're owed. But it also comes with a strict time limit: you generally have 3 months less one day from your dismissal date to start early conciliation with ACAS, which is a required first step before a tribunal claim.
If any of this sounds like your situation, don't sign a settlement agreement or accept a payment as "final" until you've had it checked. ACAS can advise for free, and an employment solicitor can tell you quickly whether you have grounds for an unfair dismissal claim alongside — or instead of — your redundancy pay.