Employment Rights Act: Collective Consultation During Redundancy
Redundancy is never easy, but under the upcoming Employment Rights Act changes, getting it wrong could be even more costly.
Two major updates are on the horizon that every business owner needs to know.
What’s Changing
1. Protective award doubling – 6 April 2026
If you fail to carry out proper collective consultation, the maximum protective award for employees affected will double from 90 to 180 days. This is a serious increase in potential financial exposure, so there’s no room for “winging it” anymore.
2. New collective consultation threshold – 2027
The threshold for triggering collective consultation is being widened. Once the regulations are confirmed, employers proposing redundancies will need to consult collectively when:
20 or more redundancies are proposed at a single establishment, or
A certain number or percentage of employees are affected across the wider organisation
This means more redundancy exercises will fall under the consultation requirement, so assumptions about “we’re below the threshold” will no longer be safe.
Why It Matters
Redundancy planning is already stressful. Add in higher financial risk and a wider consultation threshold, and mistakes can be expensive - not just financially but also in terms of morale and reputation.
Failing to consult properly could result in:
Significantly higher protective awards
Employment tribunal claims
Damaged relationships with employees and trade unions
In short, redundancy planning now requires more structure, more foresight, and closer HR oversight.
What You Should Be Doing Now
Review your current redundancy processes – are they robust enough to handle larger-scale consultation?
Plan ahead – build in enough time for collective consultation, even if you’re not sure the new threshold applies yet.
Engage HR early – don’t wait until the last minute. Structured advice and documentation are your safety net.
Train managers – make sure leaders know when to escalate redundancy discussions and how to handle them sensitively.
Document everything – from planning to consultation meetings, proper records will protect your business if disputes arise.
Bottom Line
Redundancy will always be challenging, but with the collective redundancy protective award doubling in 2026 and the new consultation threshold in 2027, preparation is everything.
Slow down, plan properly, involve HR early, and you’ll reduce the risk of costly mistakes - and keep your business and your people on steadier ground.
Streetwise HR can help you review your redundancy processes, train managers, and ensure your consultation practices are rock solid. Get in touch before these changes hit to protect your business.