What is the current situation?
If an employer is planning 20 or more redundancies at one establishment within a 90-day period, they must consult with representatives of the affected employees.
This applies to ‘redundancies’ in the usual sense, and also where dismissals are used to change terms and conditions. (You can read more about changes to fire and rehire here.)
Under the current rules, ‘establishment’ generally means one workplace or site.
Consultation must begin ‘in good time’ and at least 30 days before the first dismissal is proposed to take place. This rises to a minimum of 45 days if the proposal is to dismiss 100 or more employees.
Failure to undertake proper collective consultation may result in ‘protective awards’ against employers of up to 90 days’ pay per employee.
So what’s changing and when?
The Employment Rights Act will change the threshold that triggers the need for collective redundancy consultation.
It is expected that from 2027, a collective redundancy consultation will be required where either:
- The employer proposes 20 or more redundancies at one establishment (which is the current threshold), or
- The employer proposes a number of redundancies across the employer’s organisation as a whole, regardless of where they occur. This new number will be defined in regulations and could be between 20 and 100, or may involve a percentage test.
These changes mean that statutory collective consultation could be triggered by small numbers of unconnected redundancies across different sites and workplaces if they happen within a 90-day period. However, employers will not need to consult all of the employee representatives together or try to reach the same agreement with all of them.
The longer consultation period that applies when 100 or more redundancies are proposed could also be triggered more often when redundancies across different sites and workplaces are counted together.
It is expected that the Government will consult on the collective redundancy organisation-wide threshold number in early 2026, with a view to changes coming into effect in 2027.
Following a Government consultation in 2024 on strengthening remedies against abuse of rules on collective redundancy and fire and rehire, the maximum award against employers for failing to collectively consult on redundancies will increase from 90 to 180 days’ pay per employee – significantly increasing the cost of failure to comply with the rules. This is expected to come into force in April 2026.
It is possible that the Government may also in future consult on whether to double the minimum consultation period from 45 to 90 days when an employer is proposing to dismiss 100 or more employees.
What you need to do
The timing of some of these actions will depend on when the detail of the new laws is finalised and when the changes come into force. However, you can start to plan now:
- Create centralised systems to track proposed redundancies across sites and workplaces. Remember you need to use the broad definition of a redundancy set out above.
- Strengthen relationships with employee representatives. Review your relationship with trade unions and other employee representatives and look for opportunities to build trust and improve communication.
- If you do not have a recognised union or standing body of employee representatives, consider setting up a standing body of employee representatives to reduce the need for repeated employee representative elections.
- Refresh manager training on how to run a statutory collective redundancy consultation, to ensure managers have the necessary skills and knowledge for when the stakes become higher and are better equipped to work successfully with unions and employee representatives.
- Prepare for more, and longer, collective consultations. Consider what can be done to further improve employee engagement to help consultations to go smoothly.
How we can help
The Employment Rights Act makes collective redundancy consultation easier to trigger and far more costly to get wrong. Small numbers of unconnected dismissals across different sites may now trigger statutory consultation.
Our HR and legal experts can help you put the right controls, processes and capability in place to manage this risk. We can support you with:
- Centralised redundancy tracking: Helping you design systems to track proposed redundancies across sites, roles and time periods so potential issues relating to relevant thresholds are identified early.
- Collective consultation planning: Supporting you to plan consultation activity in advance, including timelines, representative engagement and communication strategy.
- Employee representative structures: Advising on the use of standing bodies of employee representatives or union arrangements to reduce delay and disruption when consultation is required.
- Manager and HR training: Refreshing manager and HR capability on collective redundancy rules, consultation requirements and working with representatives.
- Risk assessment and escalation controls: Helping HR teams identify when individual decisions may collectively trigger consultation obligations and when to escalate early.
- Supporting live consultation processes: Hands-on support during collective consultation to ensure it runs smoothly including full management of the entire process where needed.
If you are preparing for a redundancy programme, our Redundancy Support packages provide structured templates, guidance and optional consultancy input to help you manage the process confidently.
Additional support and resources
Stay informed and prepared by signing up to our email updates, where we’ll share confirmed changes and key dates as they come into force. Members can access up-to-date guidance, template policies and letters in our HR & Legal Resources section, and our expert team is on hand to answer questions or provide practical support, whether or not you are a Make UK member. You can also contact our ERA enquiry line.
To see the planned changes at a glance, download our free Employment Rights Act planner for clear timelines and practical next steps. If you’d like a deeper insight, ask about our Audit and Impact Assessment - a structured review to help you understand your levels of risk, prioritise actions and plan with confidence.