If you are planning redundancies, one of the first legal questions is whether you have to consult collectively. Many employers assume the answer only becomes relevant once a final number has been agreed. In fact, the legal duty can arise earlier than expected, and getting it wrong can be expensive.
What the law requires
The duty to consult collectively arises under section 188 of the Trade Union and Labour Relations (Consolidation) Act 1992. It applies where an employer is proposing to dismiss 20 or more employees as redundant at one establishment within a period of 90 days or less.
The word “proposing” is key. Consultation must happen early enough that there is still a genuine opportunity to influence the employer’s approach. That means before dismissal notices are issued and before decisions have been finalised. Employers who treat consultation as a final procedural step often find themselves accused of starting too late.
The challenge is that proposals do not always arrive as a single, obvious decision. In many businesses, redundancy proposals develop gradually. A cost-saving target becomes a headcount reduction. A headcount reduction becomes a departmental restructure. A departmental restructure becomes a set of at-risk roles. Each stage may feel preliminary, but the law may treat the proposal as having crystallised earlier than the employer expects.
Why employers get it wrong
Collective consultation obligations are rarely ignored deliberately. More often, the difficulty lies in recognising when the duty has been triggered, particularly where a business is managing change in stages.
Redundancy planning often begins as part of a broader restructuring discussion. The numbers may be refined gradually. The affected roles may not be identified until later. The business may still consider itself to be at an early stage, even though legally it has moved into the territory of proposals.
This is where employers become exposed. The law does not wait for a business to feel ready. It is concerned with what is being proposed, and that can arise while plans are still being shaped.
How it happens in practice
Collective consultation risk is often created by the way decisions are made internally. Workforce change is frequently driven by commercial pressure and handled through overlapping workstreams. Finance may be working towards a savings target. Senior management may be discussing organisational structure. HR may be preparing communications. Operational leaders may be identifying affected roles. Legal advice may not be sought until the business considers itself ready to begin formal consultation.
The problem is that section 188 does not wait for internal processes to align. The duty is assessed objectively by reference to what the employer was proposing. If the employer was proposing redundancies on a scale that met the threshold, the duty arises whether or not anyone within the organisation identified the trigger point.
Internal documents can become important evidence later. Workforce planning papers, board approvals and restructuring proposals can all be examined to determine when the redundancy proposal actually existed, even if the employer believed it was still at a preliminary stage.
The mistake employers make with staggering
A common assumption is that collective consultation can be avoided by keeping each round of redundancies below 20. This is often described as staggering, spacing out, or running smaller exercises sequentially.
The difficulty with this approach is that it treats the law as though it is only concerned with the final outcome. In reality, section 188 focuses on what is proposed. If an employer is planning redundancies on a scale that meets the threshold, the duty to consult may already exist even if dismissals are implemented in smaller groups.
The question is not simply how many employees were dismissed in each phase. It is whether the evidence shows that a wider redundancy proposal existed at an earlier stage. Tribunals may consider workforce planning documents, cost-reduction modelling, restructuring papers and internal communications to assess whether phased redundancies were genuinely separate exercises, or whether they formed part of a broader proposal that existed earlier.
This is why staggering is not a reliable strategy. Even where redundancies are implemented in phases for genuine operational reasons, the employer may still face the argument that the overall plan amounted to a single proposal.
What Micro Focus Ltd v Mildenhall clarified
A recent Employment Appeal Tribunal decision provides useful clarification on how the statutory threshold should be assessed where redundancies occur in phases.
In Micro Focus Ltd v Mildenhall, the EAT confirmed that the test is forward-looking. It is assessed by reference to the number of dismissals the employer is proposing within a future period of 90 days, rather than by retrospectively adding up dismissals that have already taken effect.
This is helpful because it reduces uncertainty where dismissals are implemented at different times for legitimate reasons. It confirms that the law does not operate as a rolling calculation that automatically adds past redundancies to later ones simply because they fall within the same 90-day period.
However, the case does not create a safe route for employers to stagger redundancies to avoid collective consultation. The EAT’s reasoning reinforces that the focus remains on proposals. Where redundancies are phased, tribunals will still consider whether they are genuinely separate exercises or whether they form part of a broader proposal that existed earlier.
The consequences of getting it wrong
Where an employer fails to comply with collective consultation obligations, the most significant financial risk is the protective award. Tribunals can award up to 90 days’ gross pay per affected employee. That liability is not limited to those who bring claims and can apply across the affected workforce.
This risk is set to increase. Under the Employment Rights Act 2025, the maximum protective award is expected to double to 180 days’ gross pay per affected employee. This materially changes the financial exposure for employers implementing redundancies at scale.
The Employment Rights Act 2025 is also expected to introduce an additional consultation trigger based on redundancies across the employer as a whole, rather than being confined to a single establishment. This is likely to be particularly significant for multi-site employers and those operating through complex structures. Approaches that may have felt workable under the current establishment-based framework may become less reliable, particularly where redundancies are phased across different sites.
The consequences are not purely financial. Where collective consultation is alleged to have been mishandled, redundancy exercises become significantly harder to manage. Employee relations can deteriorate quickly. Trade union involvement may intensify. Litigation may develop alongside individual claims. Senior management time is diverted into dispute resolution at precisely the moment when the business needs stability.
Collective consultation is best understood as part of risk management, not a procedural hurdle.
What employers should do
The forward-looking approach confirmed in Micro Focus Ltd v Mildenhall provides a clearer framework for assessing whether collective consultation is required where redundancies occur in phases.
The more important lesson is that employers should be cautious about treating phased redundancies as automatically separate for the purposes of section 188. The statutory duty is not avoided simply because dismissals are implemented in smaller groups. The legal analysis will focus on what was proposed, when it was proposed, and what the evidence shows about the scale and nature of the plan.
In a landscape where financial penalties are increasing and consultation obligations are likely to widen, employers should treat collective consultation as part of redundancy planning from an early stage. The most effective way to reduce risk is to identify proposals early, document decision-making carefully, and seek advice before a phased approach becomes an argument that consultation should have started sooner.
