Collective Redundancy Consultation UK
The not so eagerly anticipated Employment Rights Bill proposes many changes including changes to the threshold for collective redundancy consultation and government notification.
Currently, the law requires employers to collectively consult if they propose to dismiss 20 or more employees at a single establishment within a 90-day period. This consultation must occur 30 days prior to the first dismissal and should focus on avoiding redundancies, reducing the number of dismissals, and mitigating their consequences.
Collective Redundancy Consultation – Changes
A significant change is on the horizon: the definition of “one establishment” will expand to encompass the entire establishment. This means that if a company operates multiple sites, redundancies at different locations could collectively trigger the requirement for consultation, even if each site individually does not reach the 20-employee threshold.
For example, if a company with 100 employees across several locations plans redundancies that, when combined, exceed 20 within 90 days, they will be obligated to consult collectively and notify the Secretary of State.
Implications
The implications of this change are substantial. Employers may need to initiate collective
consultations as a standard practice, even for smaller redundancy plans. A more proactive and
coordinated approach to restructuring will be necessary, particularly for multi-site companies,
which will need to improve communication and tracking of redundancy processes across
locations. Failure to comply with these consultation requirements could result in employees being
entitled to a protective award, which can amount to up to 180 days of gross pay per employee if
the proposal to double the protective award is accepted.
Consultation Period
Furthermore, the proposed framework in 2025 includes consultation on doubling the minimum
consultation period when an employer is proposing to dismiss 100 or more employees from 45 to 90
days.
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