Centralise how you track redundancies as small numbers of dismissals across sites and workplaces may in future trigger statutory consultation processes and mistakes will be costlier

Situation before reforms under the Employment Rights Act 2025

If an employer is planning 20 or more redundancies at one establishment (generally one workplace or site although it will depend on the circumstances) within a 90-day period, it 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 how the ERA 2025 will impose restrictions on such ‘fire and rehire’ practices here.)

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 could result in ‘protective awards’ against employers of up to 90 days’ pay per employee.

So what’s changed/changing and when?

From 6 April 2026, the maximum protective award against employers for failing to collectively consult on redundancies has increased from 90 to 180 days’ pay per employee – significantly increasing the cost of failure to comply with the rules. There is currently some uncertainty around exactly how the transitional provisions under the Employment Rights Act will apply, but it is safest for employers to assume that the new maximum is applicable to all dismissals that take effect on or after 6 April 2026.

Looking ahead, the Employment Rights Act will also 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:

• The employer proposes 20 or more redundancies at one establishment, or
• The employer proposes a threshold number of redundancies across the organisation as a whole (with the threshold number to be determined in regulations). 

These changes mean that statutory collective consultation could be triggered by small batches of unconnected redundancies across different establishments if their proposed termination dates fall within a 90-day period. However, employers will not in such circumstances need to consult all of the employee representatives together or try to reach the same agreement with all of them.

The Government consultation on the level and methods by which the new organisation-wide threshold for triggering collective redundancy obligations might be set will close on 21 May 2026. The consultation document outlines four possible methods which could be used to set the threshold, although is likely the Government will adopt one of the following two options:

• using a single fixed number in the range of 250 to 1,000 proposed redundancies, applicable to all organisations regardless of size (this is currently the Government’s preferred approach)
• using different numbers of proposed redundancies based on number of employees in the organisation. 

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.

• Create centralised systems to track proposed redundancies across sites and workplaces. Remember you need to use the broad definition of a redundancy incorporating ‘fire and rehire’.  
• 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 as the stakes become higher and are better equipped to work successfully with unions and employee representatives.
• Prepare for more collective consultations. Consider what can be done to further improve employee engagement to help consultations to go smoothly.

How Bhayani Law can help you

Bhayani Law supports employers at every stage of the redundancy and collective consultation process. We can:

• Assess whether collective consultation is triggered, including where redundancies are spread across multiple sites or workplaces

• Advise on planning and timing, helping you manage risk as thresholds and consultation periods change

• Support and guide collective consultation, including strategy, documentation and communications with employee representatives and trade unions

• Train managers on running compliant and effective collective consultations

• Review redundancy proposals to minimise exposure to protective awards and unfair dismissal claims

• Provide ongoing HR and employment law support to help you prepare for longer and more complex consultation exercises

Our practical, commercial advice helps employers remain compliant while managing change with confidence and clarity.

Already getting support from Bhayani Law?

You will receive regular updates on key legal changes so you can stay compliant and well-prepared.

If you need advice, our expert team can support you in assessing whether collective consultation rules are triggered and how to conduct the process effectively.

Our HR and legal team can also work alongside you on redundancy projects now or in future, managing everything from planning and compliance to employee relations, communications and outplacement support.

We also offer training for managers and employee representatives to ensure everyone understands their roles and responsibilities.

New to Bhayani Law?

You don’t have to face the changes alone. Whether you need quick input or ongoing support, we can help you however works best for your business.