What Are Collective Redundancies?
When an employer needs to reduce their workforce, they may have to make several employees redundant at the same time. This situation is known as a collective redundancy. In UK law, a collective redundancy occurs when an employer proposes to dismiss 20 or more employees at one establishment within a 90-day period for reasons not related to the individuals themselves but because their roles are no longer needed. This is different from an individual redundancy, which involves just one person or a very small number of staff.
Collective redundancies are significant because they trigger additional legal obligations for employers, beyond those required for individual redundancies. The main piece of legislation governing this area is the Trade Union and Labour Relations (Consolidation) Act 1992 (TULRCA). Under these laws, employers must follow strict rules around consulting with employees and their representatives, providing advance notice, and notifying the government. The aim is to ensure that affected employees are treated fairly and have a chance to understand and respond to the proposed job losses.
A key feature of collective redundancy is the requirement for collective consultation. This means employers must consult with either a recognised trade union or elected employee representatives about the reasons for redundancies, ways to avoid them, and how to reduce their impact. The consultation must begin at least 30 days before the first dismissal if 20–99 employees are affected, or at least 45 days before if 100 or more employees are at risk. Failing to follow these rules can lead to costly penalties for employers and additional compensation for employees. For detailed government guidance on the consultation process and employer duties, see the official Making staff redundant: Redundancy consultations – GOV.UK resource.
Collective redundancies sit within the broader topic of redundancy, which covers all situations where jobs are lost due to business changes, closures, or reduced need for certain roles. If you’re new to the subject, it can be helpful to start with the basics of Understanding Redundancy in UK Law: Your Rights Explained.
It’s also important to recognise that redundancy is just one type of dismissal under UK law. If you’re facing redundancy as part of a group, you may wish to understand how redundancy compares to other forms of dismissal, such as misconduct or capability. To explore these differences, visit our section on Redundancy and Dismissal.
When Does Collective Redundancy Apply?
When Does Collective Redundancy Apply?
Collective redundancy rules come into play when an employer proposes to dismiss 20 or more employees at one establishment within a 90-day period for reasons not related to the individuals themselves (such as business closure or restructuring). This threshold is set out in the Trade Union and Labour Relations (Consolidation) Act 1992 (TULRCA), which is the main piece of legislation governing collective redundancies in the UK.
Thresholds and Triggers
The key trigger for collective redundancy rules is the number of employees affected. If fewer than 20 employees are at risk of redundancy within a 90-day window, the special collective procedures do not apply – though individual redundancy rights still do. Once the threshold of 20 or more is reached, employers must follow additional legal steps, including consulting with employee representatives and notifying the government through the Redundancy Payments Service.
It’s important to note that the “establishment” refers to the part of the business where the affected employees work. For larger organisations with multiple sites, redundancies at each site are considered separately when determining if the collective rules apply.
Common Situations and Types of Businesses
Collective redundancies are most often seen in industries facing economic challenges, business closures, or large-scale restructuring – such as manufacturing, retail, hospitality, and transport. However, any business, regardless of size or sector, must comply with collective redundancy rules if the threshold is met. For example, a local factory shutting down a production line or a head office undergoing major restructuring could both trigger collective redundancy obligations.
Why Recognising Collective Redundancy Matters
Understanding when collective redundancy rules apply is crucial for both employers and employees. Employers who fail to recognise and follow the correct procedures risk legal claims and financial penalties. Employees, on the other hand, are entitled to specific rights and protections, including consultation and notice periods, which ensure fair treatment during what can be a difficult process.
If you want to learn more about your rights regarding notice periods and what counts as a fair dismissal in redundancy situations, our section on Special Considerations: Redundancy and Fair Dismissal provides further guidance.
Employer’s Duty to Consult
When an employer is considering making collective redundancies – meaning 20 or more employees may lose their jobs within a 90-day period at a single establishment – they have a legal duty to consult with employee representatives or trade unions. This duty is set out under the Trade Union and Labour Relations (Consolidation) Act 1992 (TULRCA). The aim is to ensure that employees are treated fairly and have a voice in the process.
Who Must Be Consulted?
Employers must consult with recognised trade unions if they exist. If there is no recognised union, consultation must take place with elected employee representatives. The consultation must begin before any final decisions are made about redundancies.
For more detailed guidance on how employers should work with unions and representatives, you can refer to the official government advice on informing and consulting with unions – GOV.UK.
What Does Consultation Involve?
During the consultation, employers are required to share specific information in writing, including:
- The reasons for the proposed redundancies
- The numbers and categories of employees at risk
- The selection criteria being considered
- The proposed method of carrying out the redundancies
- How redundancy payments will be calculated
Consultation is not just a formality. Employers must discuss ways to avoid redundancies, reduce the number of employees affected, and mitigate the impact on those who may be dismissed. This process gives employee representatives the chance to suggest alternatives, such as redeployment, reduced hours, or voluntary redundancies.
If you want to make sure your concerns are addressed during this process, see our guide to key redundancy consultation questions for fair treatment.
Minimum Consultation Periods
The law sets out minimum consultation periods based on the number of proposed redundancies:
- 20 to 99 redundancies: Consultation must start at least 30 days before the first dismissal.
- 100 or more redundancies: Consultation must start at least 45 days before the first dismissal.
Failure to follow these rules can result in claims to an employment tribunal and may lead to a "protective award" for affected employees.
Why Consultation Matters
Consultation is crucial for ensuring fair treatment during collective redundancies. It provides employees with an opportunity to understand the reasons for job losses, influence the process, and explore alternatives to redundancy. This approach not only helps protect employee rights but also supports a transparent and constructive dialogue between employers and staff.
To learn how redundancy fits within wider employment law, you may also find it helpful to read our overview of redundancy and dismissal.
Notice Periods and Notification Requirements
When a business plans to make collective redundancies – meaning 20 or more employees may be dismissed within a 90-day period – strict rules apply regarding notice periods and official notifications. These requirements are designed to protect employees and ensure transparency throughout the process.
Notice Periods for Employees
Employers must provide affected employees with proper notice before their employment ends. The minimum statutory notice periods, as set out in the Employment Rights Act 1996, are:
- At least one week’s notice if employed between one month and two years.
- One additional week’s notice for each further year of continuous employment, up to a maximum of 12 weeks.
For example, someone with five years of continuous service must be given at least five weeks’ notice. Employers may offer longer notice periods if specified in employment contracts, but they cannot give less than the statutory minimum. Employees are entitled to their normal pay and benefits during the notice period. For further details on the process of giving notice, visit Making staff redundant: Giving staff notice – GOV.UK.
Notifying the Government
In addition to informing employees, employers planning collective redundancies have a legal obligation to notify the Secretary of State for the Department for Business, Energy & Industrial Strategy (BEIS). This must be done using form HR1.
- If 20–99 redundancies are proposed: Notification must be given at least 30 days before the first dismissal takes effect.
- If 100 or more redundancies are proposed: Notification must be given at least 45 days before the first dismissal.
The notification should include:
- The reasons for the redundancies
- The number and categories of employees affected
- The proposed method of selecting employees for redundancy
- The time period over which dismissals will occur
Failing to notify BEIS is a criminal offence. Employers who do not comply may face an unlimited fine and potential delays to the redundancy process. It is essential to meet these obligations to avoid legal and financial penalties.
For a deeper understanding of how notice and termination operate in redundancy situations, see our section on Special Considerations: Redundancy and Fair Dismissal.
By following these notice and notification requirements, employers help ensure a fair process and protect both their business and employees’ rights.
Employee Rights During Collective Redundancy
When a group of employees faces redundancy, UK law provides clear rights and protections to ensure fair treatment throughout the process. Understanding these rights can help you navigate the situation with confidence and know what support is available.
Right to Be Consulted and Informed
If your employer is proposing to make 20 or more employees redundant within a 90-day period, they must follow a collective consultation process. This means you have the right to be informed about the reasons for redundancy, the number of jobs at risk, and the selection process. Employers are legally required to consult with employee representatives (such as trade union reps or elected staff reps) before any final decisions are made. This consultation should give you the chance to ask questions, raise concerns, and suggest alternatives to redundancy.
Right to Redundancy Pay
Most employees who are made redundant as part of a collective process are entitled to statutory redundancy pay, provided they have worked for their employer for at least two years. The amount you receive depends on your age, length of service, and weekly pay. There are specific rules about how this is calculated, and some employees may be eligible for enhanced redundancy pay under their contract.
For a detailed breakdown of who qualifies and how much you could receive, see our guide on Redundancy Pay Eligibility and Timeline.
Fair Selection and Challenging Unfair Decisions
Employers must use a fair and objective method when deciding who will be made redundant. Common selection criteria include skills, experience, disciplinary record, and attendance. You have the right to know how these criteria are applied and to challenge a decision if you believe you have been unfairly selected. If you suspect discrimination or that proper procedures have not been followed, you may be able to claim Unfair Dismissal: Your Rights and How to Challenge Being Fired.
Offers of Suitable Alternative Employment
If your employer has other roles available, they should offer you any suitable alternative employment before making you redundant. You have the right to a trial period in a new role to see if it fits. Refusing a suitable offer without a valid reason could affect your entitlement to redundancy pay. Learn more about your options in Refusing Suitable Alternative Employment.
Redundancy Rights When Off Sick
Being off work due to illness does not affect your fundamental redundancy rights. You are still entitled to consultation, notice, and redundancy pay if you meet the eligibility criteria. There are, however, some practical considerations if you are on sick leave during your redundancy notice period. For more details, visit Off Sick During Redundancy Notice?.
Support for Mental Health
Facing redundancy can be stressful and may impact your mental wellbeing. Employers should offer support, such as access to counselling or employee assistance programmes. You also have workplace rights relating to mental health that continue during redundancy. For information on your rights and where to find help, see Mental Health and Work: Your Rights.
For a full overview of your legal protections during redundancy, you can review the Employment Rights Act 1996, which sets out the main rules employers must follow. If you are unsure about your rights or believe your employer has not acted fairly, consider seeking advice from a union representative or an employment law specialist.
How to Challenge or Appeal a Collective Redundancy
If you believe your collective redundancy was handled unfairly or the correct legal process was not followed, you have several options to challenge or appeal the decision. Here’s how you can take action, protect your rights, and seek a fair outcome.
1. Understand Your Rights
The law requires employers to follow strict procedures during collective redundancies, including fair selection processes, proper consultation with employees or representatives, and appropriate notice periods. Under the Trade Union and Labour Relations (Consolidation) Act 1992, employers must consult with employee representatives where 20 or more redundancies are proposed within 90 days at one establishment. If these requirements are not met, affected employees may have grounds to challenge the redundancy.
It’s essential to familiarise yourself with your legal rights before taking any steps. The government provides clear guidance on being selected for redundancy and how to appeal if you believe the process was unfair. This resource outlines what fair selection should look like and what to do if you feel you’ve been treated unjustly.
2. Gather Evidence
If you suspect the redundancy was unfair, start by collecting all relevant documentation. This may include:
- Your redundancy letter and any correspondence from your employer
- Notes from consultation meetings
- Details of the selection criteria used
- Records of how the process was applied to you and your colleagues
Having clear evidence will strengthen your case, whether you are raising concerns informally, submitting a formal grievance, or taking legal action.
3. Raise Your Concerns
You can begin by discussing your concerns directly with your employer or your employee representative. If this does not resolve the issue, you may submit a formal grievance following your employer’s internal procedures.
If the problem persists, you can take your case to an employment tribunal. Common grounds for challenging a collective redundancy include:
- Failure to consult collectively or individually
- Unfair selection for redundancy
- Breach of statutory notice periods
You must generally submit a claim to an employment tribunal within three months (less one day) from the date your employment ended.
4. Seek Legal Advice or Representation
Navigating redundancy law can be complex. It’s a good idea to seek advice from a trade union representative, an employment solicitor, or a local Citizens Advice Bureau. They can help you understand your chances of success and guide you through the process. For detailed, step-by-step guidance on making your case and improving your chances of a positive outcome, see our guide on how to win your redundancy case.
5. Explore Related Legal Protections
If you think your dismissal was not just a redundancy but may qualify as unfair dismissal, you might have additional legal protections. Learn more about your options and rights in our guide to unfair dismissal and how to challenge being fired.
Challenging a collective redundancy can feel daunting, but understanding your rights, gathering evidence, and seeking expert advice can make a significant difference to your outcome.
Common Issues and Concerns in Collective Redundancy
Collective redundancy processes can be complex, and both employees and employers often face a range of issues and concerns. Understanding your rights and obligations is vital to ensuring fair treatment and avoiding legal pitfalls. Below, we outline some of the most common problems that arise during collective redundancies and how to address them.
Spotting the Risks of Sham Redundancies
A key concern for many workers is the risk of so-called “sham redundancies.” This occurs when an employer claims jobs are being made redundant, but in reality, the roles still exist or are quickly refilled, sometimes to remove specific employees or avoid legal responsibilities. Signs of a potential sham redundancy include a lack of genuine business reasons for job losses, inconsistent selection criteria, or evidence that dismissed employees are replaced soon after.
If you suspect your redundancy may not be genuine, it’s important to know how to identify and challenge it. Our guide to sham redundancy explains what to look out for and steps you can take if you believe your redundancy is not legitimate. For more on the legal definition of a genuine redundancy and the rules employers must follow, see the official guidance on making staff redundant: Overview – GOV.UK.
What If the Employer Fails to Follow Consultation Rules?
Under the Trade Union and Labour Relations (Consolidation) Act 1992, employers planning to make 20 or more employees redundant within a 90-day period must consult collectively with affected staff or their representatives. This consultation must be meaningful and start at least 30 days before the first dismissal (or 45 days if 100 or more employees are affected).
If an employer fails to follow these consultation requirements – such as not providing enough information, not consulting for the required period, or excluding certain groups from discussions – employees may be entitled to compensation. This is known as a “protective award,” which can be up to 90 days’ pay per affected employee. If you think your employer has not followed the proper process, you can raise the issue with your union or employee representatives, or seek advice from ACAS or an employment solicitor.
Resolving Disputes and Disagreements
Disputes can arise at any stage of the collective redundancy process, whether over selection criteria, the fairness of the process, or the amount of redundancy pay. If you disagree with your selection for redundancy or the way the process has been handled, you should first raise your concerns through your employer’s internal procedures or with your staff representatives.
If matters cannot be resolved internally, you may consider taking your case to an employment tribunal. For more guidance on recognising and responding to unfair treatment, see our section on signs you may be facing sham redundancy.
Collective redundancies can be stressful and confusing, but knowing your rights and the correct procedures can help protect you from unfair practices. If you’re unsure about any aspect of the process, seek independent advice as soon as possible.
Additional Resources and Related Topics
When facing collective redundancies, understanding your rights and options is essential. To help you navigate this challenging time, we’ve gathered additional resources and related topics that provide both practical advice and in-depth legal guidance.
If you are an employer considering making positions redundant as part of a business restructure, you may find it helpful to review the detailed steps and legal requirements in our Employer Guide to Making Positions Redundant by Restructuring. This guide covers how to follow fair procedures, consult with staff, and minimise legal risks during organisational changes.
For employees working in the NHS, redundancy pay calculations can be complex and are subject to specific rules. Our NHS Redundancy Calculation: Maximize Your Payout Guide explains how payouts are determined, what to expect, and how to ensure you receive everything you’re entitled to under NHS terms and conditions.
After redundancy, many people have questions about financial support. You may be eligible to claim certain benefits, such as Jobseeker’s Allowance or Universal Credit. For a step-by-step overview of what to do next, see our advice on Claiming Benefits After Being Sacked, which also applies to those made redundant.
It’s also important to be aware of your rights if you suspect your redundancy may not be genuine. If you believe your employer is using redundancy as a pretext for dismissal, our resource on Challenging Sham Redundancy explains how to recognise unfair practices and what legal recourse you may have.
Exploring these related topics will give you a fuller understanding of collective redundancies, the consultation process, and your entitlements. Whether you’re an employee or employer, being informed is the first step to fair treatment and making confident decisions during workplace changes.
