New trigger for collective redundancies - what options is the government considering?

Current position

Employers must go through a prescribed period of collective consultation once they propose to make 20 or more employees redundant at one establishment within a period of 90 days. Large scale redundancies spead across multiple sites, won't trigger the duty unless at least 20 employees are being made redundant at a site. That means that the duty can arise in some sites, but not others. 

Employment Rights Act 2025

The Employment Rights Act 2025 seeks to address this disparity by introducing a new trigger. 

The current trigger will remain. But, in addition, employers will have to undertake collective redundancy consultation whenever they propose to make a threshold number of redundancies across their entire organisation.

The government is seeking views on the level and methods by which the new organisation-wide threshold for triggering collective redundancy obligations might be set and is considering two options: 

• using a single fixed number in the range of 250 to 1,000; or

• tiering this new obligation based on number of employees.

Option one: single fixed number

The government believes that using a fixed number is the easiest way for both employers and trade unions/employees to understand when collective consultation is required. 

It has suggested a range of  250-1,000 will avoid placing disproportionate regulatory burdens on small and medium businesses (a risk if set lower than 250), whilst ensuring that employees still benefit from collective consultations (a risk if set higher than 1,000). 

The government wants to know which fixed number to apply within that range. It has provided a table to show how many employers are likely to be in scope if the figure is set at 250, 500, 750 or 1000 employees. 

Option two: tiered based on number of employees 

The government is asking for views on three proposals under this head, the most significant of which is: 

1. Different fixed number thresholds depending on the size of the employer

Under this model, employers would need to collectively consult their workforce where it meets the following thresholds: 

• 250 redundancies for organisations with 0-2,499 employees,

• 500 redundancies for those with 2,500-9,999 employees; and

• 750 redundancies for those with 10,000 or more employees.

Employers will have to calculate how many staff it employees on a snapshot date - 5 April each year to make this as simple as possible to administer.

This approach would permit the largest employers to make many more redundancies without being required to undertake collective consultation, and so the government's view is that this option may not provide adequate protection to employees. 

The other options being considered are:

2. Percentage of the workforce 

Under this method, collective consultation would be triggered when an employer proposes to make a certain percentage of its total workforce redundant.

3. A hybrid combining fixed numbers and percentage thresholds