30% of Employers Likely to Make Redundancies This Year

4 minutes reading time

A new survey from ACAS found that 30% of employers believe they are likely to make redundancies over the next 12 months.

The survey, undertaken by YouGov, found that 41% of large businesses (those that employ more than 250 employees) were likely to make redundancies compared to 20% of small and medium businesses (those with 1 to 249 employees).

If handled incorrectly, redundancy situations can harm employee relations and provoke unwanted employment claims.

In this article, we have picked out just a few key questions that employers might want the answers to when they first consider redundancies.

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30 of Employers Likely to Make Redundancies This Year

Is there a genuine redundancy situation?

A redundancy situation can arise in three situations:

  1. A business is ceasing trading altogether;
  2. A business is closing or moving a workplace; or
  3. A business has a reduced need for employees carrying out work of a particular kind.

To determine whether a redundancy situation is genuine, an Employment Tribunal will look at whether any dismissal was because of one of these reasons.

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Is there a genuine redundancy situation

Do the collective consultation rules apply?

As the survey suggests that there is a higher probability that large businesses are proposing to make redundancies, it is more likely that the collective consultation rules will apply due to the volume of employees that may be at risk of redundancy.

Collective consultation applies when an employer proposes 20 redundancies at a single establishment over a 90 period.

Where collective consultation is triggered, the obligations of the employer include:

  1. Informing the Secretary of State;
  2. Identifying appropriate representatives of affected employees; and
  3. Consulting with representatives.

To consult properly, an employer must meaningfully engage in discussions with employee representatives on the redundancy proposals.

A fair consultation process has been identified as including:

  • Open-minded consultation whilst the proposals are at a formative stage.
  • Providing adequate information about the redundancy situation and their selection.
  • Giving adequate time for employees to respond.
  • Genuine exploration of the comments and suggestions of employees.

In addition to ensuring that the redundancy dismissal is fair on an individual basis, the employer must comply with additional requirements to provide information about its proposals and to consult on a collective basis.

In cases where between 20 and 99 dismissals are proposed in the 90 day period, collective consultation must be started in good time and last at least 30 days before the first dismissal happens.

For cases of 100 or more dismissals, it must be started in good time and last at least 45 days before the first dismissal.

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Do the collective consultation rules apply

What are the consequences of failing to follow the collective consultation rules?

Failure to inform the Secretary of State is a criminal offence that can result in a fine.

In addition to a claim for unfair dismissal, failing to comply with other rules could result in the Employment Tribunal awarding what is known as a "protective award" up to a maximum of 90 days of gross pay per employee.

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What are the consequences of failing to follow the collective consultation rules

Are there alternatives to redundancy?

ACAS recommend that employers "exhaust all possible alternatives to redundancies" before embarking on a redundancy process.

This is because dismissal is likely to be unfair if an employer gives no thought to whether suitable alternative employment exists within its organisation.

Some alternatives might include the following:

  • Suitable vacancies.
  • Changing a role to part-time hours.
  • Retraining or redeploying.
  • Cutting overtime.
  • Deferring new hires.

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Are there alternatives to redundancy


The rules around redundancy selection, collective consultation and alternatives to redundancy are complex and can be costly to get wrong.

There is no one-size-fits-all approach in redundancy situations, and consultation may be made more streamlined or comprehensive, depending on the circumstances.

Please get in touch with our employment law specialists if you need help planning and structuring your consultation process.

This is a brief overview, so if you would like more information on this topic, feel free to re-visit the three-part guide we previously published on how to run redundancy processes:

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If you are an employer seeking advice on redundancies, please contact our expert team of employment lawyers on: