Redundancy is a type of dismissal that occurs when a role in the company is no longer required. They are often a difficult but necessary part of business restructuring, mainly during periods of economic uncertainty or organisational changes within the business.
When an employer proposes a larger scale redundancy (a collective redundancy consultation) additional legal obligation can rise. Failure to follow the correct process can create a significant legal risk, making it important to understand each stage of the consultation process.
In this guide, we explain when collective redundancy consultation applies, the thresholds employers need to be aware of, and what the recommended steps are for employers to take.
What is Collective Redundancy Consultation?
Collective redundancy consultation is a legal requirement, where employers must consult with representatives of affected employees, before making redundancies. The law covering collective consultation is the Trade union and Labour Relations (Consolidation) Act 1992.
It applies when an employer proposes to make 20 or more employees redundant within a 90-day period, and the redundancies are in one establishment. All three elements must be considered carefully, as misunderstandings around the thresholds are one of the most common causes of non-compliance.
Employers can’t inform employees of a final decision that has already been made. The law requires consultation to take place ‘with a view to reaching agreement’.
When Does Collective Redundancy Consultation Apply?
Collective redundancy consultation applies when an employer proposes to make 20 or more employees redundant within a 90-day period at a single establishment.
All these elements must be considered carefully, to avoid any causes of non-compliance:
- The Threshold: You are planning to make 20 or more employees redundant.
- The Timeframe: The proposed redundancies will occur within any 90-day period. This means employers cannot simply look at redundancies’ month-by-month in isolation.
- The Location: The redundancies are happening at a single establishment. This is one of the more complex aspects of the collective redundancy law.
An establishment refers to the local site or unit where employees are assigned work, rather than the entire company. This includes:
- A single office
- A warehouse
- A factory
- A retail branch
- A regional site
Employers operating across multiple locations means redundancies are not always aggregated across the business as a whole, however under the Employment Rights Act 2025, new rules will help create a wide trigger across the whole business.
When Must Consultation Begin?
You must not decide on any redundancies before holding a collective consultation, so it must begin in good time to make sure you meet consultation requirements.
You must start consultations for:
- 20 to 99 redundancies – at least 30 days before the proposed date of any redundancy.
- 100 or more redundancies – at least 45 days before the proposed date of any redundancy.
There are also no rules for how long consultation must last. If it’s a large or complicated redundancy situation, consultation may take longer then 30 or 45 days. If the consultation finishes sooner, you must not make anyone redundant before the end of the 30 or 45 days.
Failure to consult trade union representatives, employee representatives or affected employees means they could make a claim to an employment tribunal. From 6th April 2026, you could be ordered to pay a ‘protective award’ as compensation for up to 180 days’ page for each affected employee.
How to Hold A Consultation
A consultation should involve open and honest discussions with employee representatives about the proposed redundancy process.
Elect Employee Representatives
If the workplace doesn’t have an officially recognised trade union, employers may need to arrange elections for employee representatives before consultation can begin.
Providing Key Information
Next, you must provide the representative or trade union with written information about the proposed redundancies, including:
- The reasons for the proposed redundancies
- The number and categories of employees affected
- The proposed method of selection
- The proposed timeline
- Details of redundancy payments
Providing clear information at an early stage helps ensure consultation is effective and well-informed.
Hold Consultation Meetings
Employers should then meet with employee representatives to discuss the proposals and consider any alternatives. You should discuss:
- Ways to avoid redundancies where possible
- Ways to reduce the number of employees being dismissed
- Minimising the impact on affected employees.
Employers should also demonstrate they have properly considered any feedback or alternative proposals raised during consultation.
Move to Individual Consultations
Collective consultation does not replace individual consultation. Employers will usually still need to meet individually with affected employees as part of a fair redundancy process.
Changes to Collective Redundancy Consultant Thresholds
For dismissals taking place after 6th April 2026, the maximum compensation (protective award) a tribunal can order for failing to properly consult has doubled from 90 days to 180 days pay per affected employee.
There are still collective redundancy changes that are happening from 2027, under the Employment Act 2025:
- Employers will need to consider the total number of redundancies across their whole organisation, not just individual workplaces – currently, collective redundancy rules only apply to individual workplaces.
- Additional protections are also expected to be introduced for certain maritime workers, including employees on ships operating from British ports but registered outside Great Britain.
Employers planning restructures over the coming years should monitor legislative developments closely and seek advice where redundancy exercises may be affected by changing consultation requirements.
How Premier Legal Can Help
Collective redundancy consultation can be a complex and sensitive process for employers. Understanding when consultation obligations are triggered, and ensuring the process is carried out correctly and at the correct stages, is essential to reducing legal risk and maintaining fair employee relations.
With redundancy laws continuing to evolve under the Employment Rights Act 2025, employers should remain up to date with their obligations and seek any advice early.
As specialist employment law solicitors, Premier Legal is here to support you at every stage of the collective redundancy consultation process. If you have any questions or would like to get in touch, contact our expert team who can advise you.
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Author
sarahrobinson@premier-legal.co.uk
Sarah Robinson is the Managing Partner and has specialised exclusively in employment law since qualifying as a solicitor in 1996.
Sarah has considerable experience of representing clients in many different industry sectors including insurance and financial services, corporate finance, technology, legal services, automotive, hotel and catering and media as well as the public sector.
Areas of particular interest include restrictive covenants, TUPE and advising in relation to discrimination.