The cost of redundancy pay for UK employers rose 9% to reach £4.9bn in the year ending 31 March 2012, according to a study from commercial law firm EMW.

This compares with a £4.5bn figure in both of the previous years. With 410,000 payments made, up 11% from the previous year, the average value had dropped by 2%.

EMW principal Louise Holder says: "The recent rise in redundancy payouts has been driven in particular by increasing numbers of redundancies in the public sector. Private sector redundancies have tailed off slightly since the 2008-09 recession. Now it is public sector redundancies that are keeping the bill for the restructuring of the UK economy creeping up.”