Collective redundancy consultation: Understanding the EAT’s new guidance

As the saying goes “don’t look back, you’re not going that way”. We now have clarity from the Employment Appeal Tribunal (EAT) that deciding whether collective redundancy thresholds are met, is a forward-looking obligation only. 

If an employer proposes to dismiss 20 or more employees within a 90-day period, they must carry out a collective redundancy consultation with the affected employees. Failing to do so can result in a protective award which is currently capped at 90 days’ pay for each employee. 

In Micro Focus Ltd v Mildenhall, the EAT decided that it was wrong to look backward as well as forward when identifying the numbers of proposed redundancies, this is a forward-looking obligation. So, if you have already carried out redundancies, you do not need to include them when calculating the numbers you now propose to dismiss. Provided, of course, that these redundancies were not contemplated at the time of the first set.

The EAT did warn that Employment Tribunals (ET) need to be vigilant to employers trying to avoid the rules by staggering redundancies, so careful thought will still need to be given in each redundancy situation. This is particularly key given the increase in the protective award for failure to consult, which is expected to double in April under the Employment Rights Act 2025 (ERA).

We look at the case in more detail below.

Micro Focus Ltd v Mildenhall: key facts

An employers’ obligations to collectively consult in cases of redundancy are set out under section 188 of the Trade Union and Labour Relations (Consolidation) Act 1992 (TULRCA). This legislation imposes a duty on employers to consult with employees or their representatives when proposing to make collective redundancies. It implements the Collective Redundancies Directive, which provides that where an employer is proposing to dismiss 20 or more employees at one establishment within a period of 90 days or less, the employer shall consult all the appropriate representatives of employees who may be affected by the proposed dismissals or by measures connected with those dismissals.

In this case, the Claimant was dismissed by reason of redundancy. The redundancies occurred in several sets within a 90-day period and affected employees employed by distinct legal entities. It gave rise to a dispute as to whether the collective consultation threshold under section 188 TULRCA had been met.

At first instance, the Employment Tribunal held that the duty to collectively consult was triggered and the Respondent had breached this duty, on the basis that there were more than 20 redundancies within a 90-day period. To establish this, the Tribunal looked across several sets of redundancies. They applied the case of Marclean (UQ v Marclean Technologies SLU) and looked backward and forward within a 90-day period to count the redundancies.

Forward looking redundancy calculations explained

On appeal, the EAT clarified that Marclean had been misapplied. The obligation under section 188 TULRCA is forward-looking, requiring a focus on the number of redundancies the employer is proposing at the relevant time. Earlier or past redundancies should not be retrospectively aggregated by looking back over a 90-day period. This means that there is no automatic requirement for previous redundancies to be combined with subsequent redundancies over a rolling 90-day period.

For example, there will be no duty to collectively consult where an initial set of redundancies is implemented and a second set is proposed two months later, provided the later redundancies were neither part of, nor reasonably foreseeable, at the time of the original proposal. Employers can manage restructuring in genuinely separate phases without automatically triggering a collective consultation obligation, provided that subsequent redundancies were not contemplated at the time the original proposals were made.

How employers can manage phased redundancies legally

Following this judgment, the Employment Appeal Tribunal cautioned that Employment Tribunals should remain alert to employers attempting to circumvent collective consultation duties. Tribunals should look out for artificial divisions of dismissals, deliberate delaying or staggering of redundancies, and any other tactics designed to avoid triggering the statutory consultation requirements.

Risk of non-compliance and protective awards

The consequences for failure to comply with collective consultation obligations are significant. From April 2026, under the ERA, the maximum protective award is expected to double to 180 days’ pay per employee, substantially increasing the potential financial exposure for non-compliant employers.

Redundancy compliance checklist for UK employers

• Update your redundancy policies and procedures
• Train managers and those involved in redundancy processes
• Ensure you clearly record your decision-making processes
• Engage legal advice early, the risks of getting consultation wrong will increase significantly from April

If you would like assistance with a redundancy process or would like training for yourself, your managers or elected employee representatives please get in touch.