Redundancy: Getting the process right

As we move further into January 2026, many organisations are taking stock of the year ahead and thinking carefully about how to set their business up for success. For some, this means reviewing structures, roles and resourcing to ensure they are fit for purpose in a changing economic landscape.

Whether driven by cost pressures, efficiency goals or longer-term strategic change, redundancy and restructuring can be difficult for everyone involved. For business owners and managers, it can feel overwhelming; for employees, it can be unsettling and uncertain. That’s why it’s so important to approach redundancy with care, clarity and compassion, and to make sure the process is handled correctly from the outset.

This blog shares good practice and highlights some of the most common mistakes employers make when considering redundancy or restructuring.

Building a strong business case

A clear and well-documented business case is the foundation of any redundancy process. You should be able to clearly explain why change is needed and how the proposed approach supports the future of the business.

Having a genuine business reason, combined with a fair and structured process, significantly reduces the risk of redundancies being challenged at an Employment Tribunal and helps build trust throughout the process.

Planning and running a meaningful consultation process

Before consultation begins, take time to plan. A clear process should set out:

• a realistic timeline
• the key steps involved
• who will be responsible at each stage

The process should start with an initial meeting to explain that employees are at risk of redundancy. This is then followed by a formal consultation period, the structure of which will depend on whether:

• a single role is affected
• all employees in a particular role are at risk, or
• there is a need to select from a wider pool of employees

If you have a redundancy policy, this should be followed. Regardless, consultation should always be focused on exploring alternatives to redundancy wherever possible. This includes considering suitable alternative roles within the business and genuinely listening to any suggestions or concerns raised by employees.

Consultation must be meaningful. Decisions should not be finalised until consultation has concluded and employees have had the opportunity to engage fully with the process.

Employees should receive at least 48 hours’ written notice of formal consultation meetings and must be allowed to be accompanied, typically by a colleague or trade union representative.

Where 20 or more redundancies are proposed, collective consultation rules apply. This includes minimum consultation periods of:

• 30 days for 20–99 redundancies
• 45 days for 100 or more redundancies

Common mistakes to avoid

One of the most common mistakes employers make is failing to establish a robust business case or rushing through consultation. Both can lead to significant legal and employee relations issues.

Another frequent error is deciding in advance who will be made redundant. Where several employees perform the same role, it can be tempting to target those perceived as underperforming. However, redundancy applies to the role, not the individual.

Selection must always be fair and objective. This is typically done by:

• applying clear, objective selection criteria across a defined group, or
• running a fair internal recruitment process for the roles that remain

Care must also be taken to ensure that employees with protected characteristics are not disadvantaged. These include age, disability, pregnancy or maternity, sex, race, religion or belief, sexual orientation, marital status and gender reassignment.

For example, if absence is used as a selection criterion, disability-related absence should be discounted. Employees on maternity leave have specific legal protection. From the point an employee informs their employer they are pregnant until 18 months after the birth of their child, they must be offered any suitable alternative role in preference to other employees if selected for redundancy.

Redundancy pay and notice entitlements

Employees may be entitled to Statutory Redundancy Pay, which is a tax-free payment based on age, length of service and weekly earnings. Getting this calculation right is essential.

Employees are also entitled to notice of redundancy. This may be worked or paid in lieu, but the notice period must always be the greater of:

• contractual notice, or
• statutory notice (one week per completed year of service, up to a maximum of 12 weeks)

Summary

Redundancy is never easy, but with the right preparation and support, it can be managed fairly, respectfully and lawfully. Taking time to plan, consult properly and follow a structured process helps protect your business and supports employees through what can be a challenging period.

If you’re considering redundancy or restructuring due to business changes and would value some guidance, our friendly team of expert HR consultants is here to help. We can talk through your specific situation and support you in getting the process right, efficiently, compliantly and with care.