Collective Redundancy Consultation: Process, Timelines and the New Doubled Penalties

Collective redundancy consultation is one of the areas of UK employment law where the financial consequences of getting the process wrong are disproportionate to the underlying redundancy decision itself. An employer can have entirely legitimate business reasons for making roles redundant and still face a substantial protective award purely because the consultation process was inadequate. From April 2026, that risk increases significantly: the maximum protective award for a breach doubles from 90 days' to 180 days' gross pay per affected employee.

This guide sets out when collective consultation obligations apply, what the process actually requires, and what changes with the increased penalty from April 2026.

When collective consultation obligations apply

Collective redundancy consultation rules apply when an employer proposes to dismiss as redundant 20 or more employees at one establishment within a period of 90 days or less. Where that threshold is met, the employer must consult collectively with appropriate representatives — either existing recognised trade union representatives or elected employee representatives — in addition to any individual consultation with affected employees.

The consultation period required depends on scale: proposals affecting 100 or more employees require consultation to begin at least 45 days before the first dismissal takes effect, while proposals affecting 20 to 99 employees require at least 30 days. Critically, these are minimum periods before any dismissal can take effect, not simply a target for when consultation should start — dismissals given effect before the minimum period has elapsed are a common source of protective award claims even where the underlying redundancy rationale is sound.

What proper consultation actually requires

Collective consultation is not satisfied by simply informing representatives that redundancies are planned. Employers must consult about ways of avoiding the dismissals, reducing the numbers involved, and mitigating the consequences for those affected — meaning consultation has to be genuine and capable of influencing the outcome, not a formality conducted after the decision is effectively final. Employers must also provide specified information in writing to representatives, including the reasons for the proposals, the numbers and categories of employees involved, the proposed selection method, and the proposed method of carrying out dismissals.

A frequent point of failure is starting consultation only after key decisions — such as which roles or sites are affected — have already been finalised internally, which can be found to fall short of the requirement to consult while proposals are still at a formative stage. Employers should also notify the Secretary of State using form HR1 before proposing to dismiss 20 or more employees, separately from the consultation obligation itself — a step that is sometimes overlooked because it does not directly involve the affected employees.

Why the penalty increase matters

A protective award is compensation payable to affected employees where an employer has failed to comply with the collective consultation requirements, calculated per employee based on a maximum number of days' pay. Doubling that maximum from 90 to 180 days' gross pay per employee from April 2026 substantially increases the total financial exposure for a failure that affects any meaningful number of staff — for a redundancy exercise affecting 100 employees, the difference between the old and new maximum runs into a very significant aggregate sum.

This increase sits alongside the launch of the new Fair Work Agency in April 2026, which gives the state a more proactive enforcement role across several employment law areas, and the wider set of Employment Rights Act 2025 changes taking effect the same month. Employers planning any redundancy exercise anticipated to reach the collective consultation threshold should treat process compliance as a higher financial priority than it may previously have been.

Practical steps for a compliant process

• Start the clock correctly. Confirm the correct minimum consultation period (30 or 45 days) based on scale, and do not treat it as a target that can be compressed if business pressure increases.
• Genuinely open decisions. Ensure consultation begins before the specific selection pool, criteria and numbers are finally fixed, so representatives have a real opportunity to influence the outcome.
• Provide the specified information in writing. Do not rely on verbal briefings alone — the statutory information requirements are specific and should be documented.
• File form HR1 on time. This notification obligation to the Secretary of State is separate from consultation with employee representatives and has its own penalty for non-compliance.
• Coordinate with any TUPE implications. Where redundancies arise alongside a business transfer, consultation obligations can interact with TUPE requirements, and the two processes need to be planned together rather than treated as entirely separate exercises.

Frequently asked questions

Does the 20-employee threshold apply per site or across the whole business?

It applies per establishment, generally meaning a single site or workplace, rather than aggregating proposed redundancies across an employer's entire operation — though what counts as one establishment can itself be a point of dispute in borderline cases.

When does the increased protective award take effect?

The maximum award doubles to 180 days' pay per affected employee from April 2026, alongside the wider Employment Rights Act 2025 changes taking effect that month.

Can an employer avoid collective consultation by staggering redundancies below 20 at a time?

Deliberately structuring redundancies to avoid triggering the threshold, where the underlying proposal genuinely involves 20 or more dismissals within a 90-day window at one establishment, does not remove the obligation — the rules are based on the substance of what is proposed, not how it is administratively packaged.

With the financial consequences of a defective collective consultation process about to double, redundancy planning needs to build in realistic timelines and genuine engagement with representatives from the outset, not treat consultation as a procedural box to tick. Learnsignal's CPD courses cover redundancy, consultation and the wider Employment Rights Act 2025 changes for UK employers.