Shift to ‘employer-wide’ trigger among UK collective redundancy reforms

The most significant of these changes is to how the total number of proposed dismissals must be calculated for the purposes of triggering collective consultation rights. While the current collective dismissal threshold – proposing to dismiss 20 or more employees [at the same establishment] within a period of 90 days or less – will remain in place, it will apply to proposed dismissals across the whole GB business rather than per establishment or location.

The changes are expected to come into force in 2027, on a date to be confirmed.

• Read more: how the Employment Rights Act will impact your business

The right to collective consultation means that employers have to discuss proposed dismissals with trade unions or employee representatives and not just individual workers. Consultation must begin 30 days before the first dismissal where between 20 and 99 dismissals are proposed, and 45 days before the first dismissal where more than 100 dismissals are proposed.

Current law says that collective consultation must happen if more than 20 dismissals are proposed “at one establishment” within any 90-day period. This proved problematic in late 2008 when retailer Woolworths went into administration and was forced to close its 807 shops. Fewer than 20 people were made redundant at each site – although the overall number of staff let go was far higher – but collective consultation was not required because the shops were classed as separate establishments.

The UK government has now laid out four potential options for determining when the employer-wide trigger for collective consultation would apply. Its consultation closed on 21 May. The government’s preference is to adopt a single fixed number of proposed redundancies – between 250 and 1,000 – with views sought on what that number should be. Alternative options included in the consultation are a percentage trigger, based on the employer’s total workforce; using different fixed thresholds based on employer size; or combining these approaches by applying a percentage threshold to smaller employers and a fixed number threshold to larger employers.

The consultation also set out proposals for how employers should calculate their total number of employees when applying thresholds linked to employer size: it suggests a ‘snapshot date’ of 5 April.

These proposals will mean substantial operational change for multi-site employers. It is likely that whatever threshold the government selects will mean that collective consultation obligations apply to more workforce restructures. Businesses will need to develop centralised HR systems capable of tracking dismissals across their entire workforce in England, Scotland and Wales over rolling 90-day periods.

They should also refresh their knowledge of collective consultation processes including what is classed as a ‘dismissal’ for these purposes – it is “for a reason not related to the individual” and is wider than redundancy. Further training on this issue may be required.

The changes will complement the increase to the maximum protective award from 90 days’ pay to 180 days’ actual pay, with no weekly cap, which came into force for dismissals taking effect on or after 6 April 2026. This significantly raised employers’ financial exposure for non-compliance with their collective consultation duties.