The redundancy process, step by step

Is it actually a redundancy?

Legally, redundancy means the job is disappearing - the business is closing, the workplace is closing, or the need for employees to do that kind of work has reduced. It does not mean the person is not good enough. If what you actually want is to remove a particular individual, that is a conduct or capability matter and dressing it as redundancy is how employers lose tribunals they could have won on the honest ground. The tell is a vacancy for the same job appearing a few weeks later.

Before going further, exhaust the alternatives - not only because it is decent, but because a tribunal will ask what you considered. Recruitment freeze, ending contractor use, reduced overtime, voluntary redundancy, redeployment, or a temporary change to hours.

Which rules apply: the two tracks

Two things get missed here often enough to be worth stating plainly. The count is of proposed redundancies across a rolling 90-day period, so three separate rounds of eight in one quarter can cross the threshold even though no single round does. And the HR1 notification is a legal duty in its own right - gov.uk states you "can be fined an unlimited amount" if you do not notify. Collective consultation is with recognised trade union representatives or elected employee representatives, or with staff directly where there are none.

The pool and the selection criteria

Two decisions do most of the work in deciding whether a redundancy is fair.

The pool is the group of employees at risk. Draw it around the work that is disappearing, and be able to explain why it was drawn there. A pool of one is possible where a genuinely unique role is going, but it deserves particular care - it is the shape most often challenged, because it can be gerrymandered around an individual.

The criteria then decide who within the pool goes. They need to be objective, measurable, and capable of being evidenced from records you already keep:

The attendance line is where well-intentioned employers get caught. Absence looks like the most objective criterion available, and it is the one most likely to import discrimination: absence related to a disability, and any absence related to pregnancy or maternity, must be discounted before the score is used. If you are scoring attendance at all, strip those out first and be able to show you did - our Bradford Factor guide covers the same exclusions in the absence-management context.

Score against the criteria on paper, keep the scores, and have someone other than the scorer sanity-check them. Every person in the pool should be able to see their own score and challenge it - that is part of what makes the consultation real.

Running the consultation

1. Write to everyone in the pool, telling them they are at risk, why, how the pool and criteria were arrived at, and when you will meet.
2. Meet individually, more than once. One meeting is rarely enough to count as consultation. Offer them the chance to be accompanied - not a statutory right in redundancy as it is in disciplinaries, but refusing it looks poor and costs you nothing.
3. Actually listen. Consultation means being open to changing the pool, the criteria, the scores or the plan. Record what people raised and what you did about it.
4. Search for alternative work throughout - including vacancies elsewhere in the group. This is an ongoing duty, not a box ticked once.
5. Confirm the outcome in writing, with the scores, the notice date and the payment breakdown.
6. Offer an appeal. Not strictly required, but it is cheap, it fixes honest mistakes before they become claims, and its absence is routinely held against employers.

An employee on maternity, adoption or shared parental leave has priority for any suitable alternative vacancy - they must be offered it ahead of others in the pool, not merely invited to apply, even where a colleague scored higher. That protection is wider than the leave itself: gov.uk puts it at "up until 18 months from the date the child is born or adopted", continuing after the employee returns to work. Getting this wrong is automatically unfair dismissal, and it is one of the most common expensive errors in the whole process - the maternity leave guide covers the full protection.

Suitable alternative employment and the trial period

Where you can offer a suitable alternative role, you must. If the employee accepts, gov.uk confirms they "can try out an alternative role for 4 weeks (or more if agreed in writing) without giving up their right to redundancy pay" - so if it does not work out within the trial, the redundancy entitlement survives. If they unreasonably refuse a genuinely suitable offer, they can lose the right to statutory redundancy pay - but "unreasonably" is judged from their position, taking account of pay, status, hours and travel, not yours.

What you have to pay

Statutory redundancy pay is due to anyone with two years' service or more, calculated on age and length of service (2026/27 figures, verified on our statutory rates page):

On top of that: statutory notice (one week after a month's service, then a week per full year up to twelve) or pay in lieu if the contract allows it, plus accrued untaken holiday. Statutory redundancy pay itself is tax-free, and sits inside the £30,000 exemption alongside any ex-gratia payment - worth modelling before you make an offer, because the aggregation catches people out. To cost a whole round, use the redundancy cost calculator.

What changes on 1 January 2027

Unfair dismissal protection currently requires two years' service. From 1 January 2027 it starts at six months, which changes the risk calculation for redundancies substantially: employees with under two years' service - who today can generally only bring a claim on discriminatory or automatically unfair grounds - will be able to challenge the fairness of the process itself. Rounds that would previously have been low-risk for short-service staff will not be. What the change means.

The mistakes that cost the most

• Deciding first, consulting afterwards. The most common and the most fatal. If the outcome was fixed before the meeting, it was not consultation.
• Announcing to the room before speaking to individuals.
• Subjective criteria - or objective criteria scored from memory.
• Missing the rolling 90-day count and stumbling into the collective regime without an HR1.
• Not adjusting attendance scores for disability and pregnancy-related absence.
• Overlooking the priority right of someone on maternity, adoption or shared parental leave.
• Re-advertising the role weeks later, which retrospectively proves it was never redundant.

The protective award doubled in April 2026

Where collective consultation obligations are breached, a tribunal can make a protective award - compensation to each affected employee, separate from any unfair dismissal award, and payable even where the redundancies themselves were entirely genuine. You can run a fair, necessary redundancy and still be liable purely for how you consulted.

The maximum was 90 days' pay. Since 6 April 2026 it is 180 days' pay - per employee. Most guidance still says 90, so this is worth stating plainly: the Employment Rights Act 2025 doubled it, and the statute now reads that the protected period "shall not exceed 180 days".

The arithmetic is what makes it serious. Twenty-five employees on an average £600 a week, at the full award, is roughly £385,000 - on a redundancy round that may have been completely justified on the business case. Against that, the cost of consulting properly is a few weeks and some meetings.

General guidance, not legal advice. Consultation thresholds, HR1 and the trial period verified against gov.uk on 9 August 2026; 2026/27 pay figures against gov.uk on 8 August 2026; the 180-day protective award and the establishment-test amendment against TULRCA 1992 s.189 and s.188 as amended by the Employment Rights Act 2025. Take advice on anything contentious - particularly a pool of one, or any case touching a protected characteristic.