Do you always get a payout if you are dismissed on Ill health grounds

[Tellmemore85]

Or is this only done when polices haven’t been followed correctly?

It depends, there's rules that have to be followed when dismissing people and if they aren't followed then you can sue. Smaller companies especially though may take a different approach and offer a generous redundancy to leave and agree to the terms because its easier- this may be advantageous as they don't have to pay any money . Companies can also offer a different role if you can no longer do your job

The company he works for is a large company. Would this make him less likely to receive anything?

There will be a policy, he should read that. They aren't legally obligated to offer anything unless they specify in their own policies they will pay something toward dismissals due to ill-health.

Has he actually been dismissed? Who has decided he’s too ill to work, is it a professional medical opinion?

www.moneywise.co.uk/health-insurance/work-family/your-rights-ill-health-dismissal

He might have some kind of critical illness insurance through work that could pay out outside of a settlement scenario - worth checking his benefits

No, it's not common.

Ill-health retirement is something different and this doesn't sound like it would come under that category.

Is he off sick long-term, OP? Likely to be able to work again at some point in the future?