The redundancy process: a step-by-step guide

What is the redundancy process in the UK?

The redundancy process normally runs through five stages: establishing a genuine redundancy situation, warning and consulting affected employees, applying a fair and objective selection process, considering suitable alternative employment, then giving notice and a right of appeal. Skipping or rushing any stage can make an otherwise genuine redundancy unfair.

1. Genuine redundancy situation. The employer must show the need for the role, or work of that kind, has ceased or diminished, or that the workplace is closing.
2. Warning and consultation. Affected employees are told what is proposed and consulted meaningfully, individually and, for larger exercises, collectively, before any decision is finalised.
3. Selection. Where only some roles in a pool are affected, the employer applies fair, objective, non-discriminatory criteria to decide who is selected.
4. Suitable alternative employment. The employer considers whether a suitable alternative role exists, including a trial period if one is offered.
5. Notice and appeal. Employees selected for redundancy are given notice, their redundancy pay, and a fair opportunity to appeal the decision internally.

What counts as a genuine redundancy?

Under section 139 of the Employment Rights Act 1996, a redundancy is genuine when the need for employees to do work of a particular kind has ceased or diminished, or the workplace is closing entirely or in a particular location. It must be the role that has gone, not a pretext to remove a particular person.

If the role is later recreated, filled by someone else doing largely the same job, or the "redundancy" targets an individual rather than a position, that points away from a genuine redundancy and towards an unfair, or even automatically unfair, dismissal. Seegov.uk: redundancy, your rightsfor the government's own summary.

What are the 5 fair reasons for dismissal, and where does redundancy fit?

Under section 98 of the Employment Rights Act 1996, there are five potentially fair reasons for dismissal: capability or qualifications, conduct, redundancy, statutory illegality, and some other substantial reason. Redundancy is one of the five, not a category with five reasons of its own; within a redundancy, employers must still apply fair, objective selection criteria.

People searching for "5 fair reasons for redundancy" are usually mixing up two different things:

• The five fair reasons for dismissal generally (ERA 1996 s.98), of which redundancy is one, alongside capability, conduct, illegality and some other substantial reason.
• The selection criteria used within a redundancy once redundancy has been established as the reason, for example length of service, skills and qualifications, and performance or disciplinary records, covered in the next section.

Even where redundancy is the genuine reason, the dismissal can still be found unfair if the process used to get there, warning, consultation and selection, was not reasonable. See ourunfair dismissal guide for how that is assessed.

What are fair redundancy selection criteria?

Fair selection criteria are objective and measurable, such as length of service, relevant skills and qualifications, attendance and performance records, and disciplinary history. Criteria must never be, or amount to, discrimination on grounds like age, sex, pregnancy, disability or race, and should be applied consistently across the whole selection pool.

How long does the redundancy process take?

It varies with the size of the exercise. A small redundancy affecting one or two roles can be completed in a few weeks once meaningful consultation has taken place. Collective redundancies of 20 or more employees at one establishment have a statutory minimum consultation period, 30 days for 20 to 99 proposed redundancies and 45 days for 100 or more, before any dismissal can take effect.

These are minimum periods, not fixed timetables. A rushed process that falls short of them, or that fails to consult meaningfully within a shorter individual exercise, is a common ground for an unfair dismissal claim. ACAS publishes practical guidance on running a compliant timetable atacas.org.uk/redundancy. If you are already partway through consultation, ourredundancy consultation guidecovers what should happen at each meeting.

Redundancy process: frequently asked questions