Information and consultation in collective redundancy

Produced by Tolley in association with Andy Williams at Charles Russell Speechlys LLP
Information and consultation in collective redundancy

The following Employment Tax guidance note Produced by Tolley in association with Andy Williams at Charles Russell Speechlys LLP provides comprehensive and up to date tax information covering:

  • Information and consultation in collective redundancy
  • When do the statutory obligations apply?
  • How to calculate the number of employees affected
  • Those not covered
  • When information and consultation must start
  • Appropriate representatives
  • Information to be provided
  • Consultation on avoiding redundancy
  • Consultation on reasons for redundancy
  • Exceptions
  • More...

When do the statutory obligations apply?

Where an employer is proposing to dismiss as redundant 20 or more employees at one establishment within any period of 90 days, specific statutory requirements for information and consultation exist (see the Collective redundancy ― overview guidance note). The duty requires the employer to consult with appropriate representatives of the affected employees about ways of avoiding the dismissals, reducing the number of dismissals and mitigating the consequences of the dismissals. If an employer fails to comply with these requirements, a claim for a protective award of up to 13 weeks’ pay per employee may be made to an employment tribunal. This note deals specifically with the information and consultation requirements in a collective redundancy scenario. This UK obligation actually derives from a European Directive, the European Collective Redundancy Directive (98/59/EC).

Although the law applies to 20 or more employees at one establishment, the European Directive which it implements refers to establishments in the plural. In the Ethel Austin case the Court of Appeal referred the question of whether employers should count the number of potential redundancies at each establishment or at all establishments to the European Court of Justice. Pending that decision, employers would be well-advised to follow the decision of the Employment Appeal Tribunal in the Ethel Austin case and consider the total number of potential redundancies across all establishments.

Where fewer than 20 employees are being made redundant, although there are no formal statutory requirements for information and consultation, employers must still act fairly to avoid successful unfair dismissal claims by the employees (see the Individual redundancy guidance note). Acting fairly in individual redundancies requires a certain level of consultation, both where employees are represented by unions and where they are not.

It is important to remember that for the purpose of the rules on information and consultation in collective redundancy, every dismissal is treated as a redundancy except those that the employer can show are for one

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