Redundancy Letter (UK)
[Employer Name]
[Employer Address]
Date: [Letter Date]
To: [Employee Name]
Job Title: [Employee Job Title]
PRIVATE AND CONFIDENTIAL
Re: Notice of Redundancy
Dear [Employee Name],
I am writing to confirm the outcome of the redundancy consultation process, during which we discussed the proposed redundancy of your role of [Employee Job Title] at [Employer Name]. I regret to inform you that your position has been made redundant and that your employment with [Employer Name] will therefore come to an end.
This letter constitutes your formal notice of redundancy, issued pursuant to your contractual and statutory rights under the Employment Rights Act 1996.
REASON FOR REDUNDANCY
[Redundancy Reason]
The redundancy situation arises within the meaning of Section 139 of the Employment Rights Act 1996.
CONSULTATION PROCESS
Individual consultation commenced on [Consultation Start Date]. The following consultation has been carried out:
[Consultation Summary]
SELECTION FOR REDUNDANCY
[Selection Pool Description]
NOTICE PERIOD AND LAST DAY OF EMPLOYMENT
Your notice period is [Notice Period]. Your last day of employment with [Employer Name] will be [Last Day of Employment].
During your notice period, you will be [Notice Arrangement]. Your salary and contractual benefits will continue to be paid during the notice period in the usual manner.
REDUNDANCY PAY ENTITLEMENT
You have [Years of Service] complete years of continuous service with [Employer Name], having commenced employment on [Employee Start Date]. You are therefore entitled to statutory redundancy pay calculated in accordance with Sections 135–165 of the Employment Rights Act 1996.
Your statutory redundancy pay is: £[Statutory Redundancy Pay].
Statutory redundancy pay is free of income tax up to £30,000 in accordance with Section 401 of the Income Tax (Earnings and Pensions) Act 2003. You should seek independent tax advice regarding the treatment of your redundancy payment.
ACCRUED ENTITLEMENTS AND FINAL PAY
Accrued but unused annual leave: [Holiday Entitlement].
Other entitlements and arrangements: [Other Benefits].
Your final payslip will set out a full breakdown of all sums due to you, including salary to the termination date, holiday pay, and redundancy pay. All deductions required by law, including PAYE income tax and National Insurance contributions (where applicable), will be made.
POST-EMPLOYMENT OBLIGATIONS
Your post-termination obligations under your contract of employment, including any confidentiality provisions and restrictive covenants, remain in full force and effect following the termination of your employment. You are required to return all company property, including any laptop, mobile phone, access cards, and confidential documents, on or before your last day of employment.
REFERENCES
You are entitled to request a reference from [Employer Name] after the termination of your employment. Please direct any such requests to the HR department.
FURTHER SUPPORT
We recognise that this is a difficult time, and we wish to support you in finding new employment. If you have any questions about the contents of this letter, your entitlements, or the redundancy process, please do not hesitate to contact [Signatory Name].
We would like to thank you for your contribution to [Employer Name] during your [Years of Service] years of service and wish you every success in the future.
Yours sincerely,
[Signatory Name]
[Signatory Title]
On behalf of [Employer Name]
EMPLOYEE ACKNOWLEDGEMENT
I, [Employee Name], confirm that I have received and read this notice of redundancy and understand its contents, including the right of appeal described above.
Signing this letter does not necessarily mean that I agree with the redundancy decision or waive any of my legal rights.
Employer (Signatory)
________________
Signature
Date: ________________
Employee (Acknowledgement)
________________
Signature
Date: ________________
What Is a Redundancy Letter (UK)?
A Redundancy Letter in the United Kingdom records an employer decision affecting an employee's engagement and the reasons and procedure followed, and is shaped by the Employment Rights Act 1996. Under Section 139 of the Employment Rights Act 1996, a dismissal is by reason of redundancy where the employer has ceased or intends to cease carrying on business at the location where the employee is employed, or where the requirement for employees to carry out work of a particular kind has ceased or diminished. A genuine redundancy situation must exist for the letter to be legally sound: redundancy cannot be used as a pretext to dismiss an employee for another reason, such as poor performance or a personality conflict, without exposing the employer to an unfair dismissal claim. Employees with at least two complete years of continuous service have a statutory right not to be unfairly dismissed under Part X of the Employment Rights Act 1996, and a redundancy dismissal must be both substantively and procedurally fair to withstand scrutiny at an Employment Tribunal. Substantive fairness requires a genuine redundancy situation and a fair selection process. Procedural fairness requires meaningful consultation, consideration of alternatives to redundancy, and — where appropriate — offering a right of appeal. A formal redundancy letter also triggers the employee's entitlement to statutory redundancy pay under Sections 135–165 of the Employment Rights Act 1996, provided they have at least two years of continuous service. The redundancy letter documents the key information needed to calculate this entitlement, including the employee's start date and years of service. For larger redundancy exercises involving 20 or more employees within 90 days, the collective consultation obligations under Sections 188–198 of the Trade Union and Labour Relations (Consolidation) Act 1992 apply in addition to the individual process. The legal framework governing the Redundancy Letter (UK) in United Kingdom draws on several key statutes and regulatory bodies. Under the Employment Rights Act 1996, the Employment Tribunal adjudicates workplace disputes. Section 94 of the Employment Rights Act 1996 provides the right not to be unfairly dismissed. The Advisory, Conciliation and Arbitration Service (ACAS) provides early conciliation under Section 18A of the Employment Tribunals Act 1996. The UK GDPR and Data Protection Act 2018 govern personal data handling. HM Revenue and Customs (HMRC) administers PAYE and National Insurance contributions under the Income Tax (Earnings and Pensions) Act 2003. Parties executing a Redundancy Letter (UK) in United Kingdom should confirm the document reflects current law, including any amendments enacted since the original drafting date. The Employment Rights Act 1996 sets the foundational requirements.
When Do You Need a Redundancy Letter (UK)?
A redundancy letter is needed whenever an employer in England and Wales has completed a genuine redundancy process in respect of an individual employee and wishes to formally notify that employee that their employment is being terminated by reason of redundancy. The letter should only be issued after the consultation process has been completed — issuing a redundancy letter before consultation has genuinely taken place is a procedural failing that may render the dismissal unfair.
Common circumstances in which a redundancy arises include: a business or workplace closure, where the employer is shutting down entirely or closing a particular site; a reorganisation or restructuring, where certain roles are no longer needed in the new operating model; a reduction in workload or client demand, where there is no longer enough work to justify the number of employees in a particular function; the introduction of new technology or automation that removes the need for certain roles; or a merger or acquisition, where duplicate roles in the combined entity are eliminated.
Before issuing a redundancy letter, the employer should have: identified a genuine redundancy situation; defined the selection pool of employees who may be affected; applied fair, objective, and consistently applied selection criteria to determine which employees are selected; carried out meaningful individual consultation — ideally at least two meetings — at which the employee has been given a genuine opportunity to suggest alternatives to redundancy; considered any alternatives to redundancy such as redeployment, reduced hours, or voluntary redundancy; and, where the redundancy involves 20 or more employees within 90 days, complied with the collective consultation requirements under the Trade Union and Labour Relations (Consolidation) Act 1992.
A redundancy letter should be issued promptly once the decision to make the individual redundant has been made, following the completion of consultation. Any unreasonable delay in issuing the formal notice can create uncertainty for the employee and may be viewed negatively by an Employment Tribunal.
What to Include in Your Redundancy Letter (UK)
A legally compliant redundancy letter for use in England and Wales must contain a number of essential elements to protect both the employer's and the employee's legal positions.
First, the letter must clearly identify the reason for the redundancy, explaining the business circumstances that have given rise to the redundancy situation in terms that correspond to the statutory definition in Section 139 of the Employment Rights Act 1996. A vague or formulaic explanation — such as 'for operational reasons' — is less defensible than a specific account of the business changes that have necessitated the redundancy.
Second, the letter should summarise the consultation process that has been undertaken, confirming the dates and nature of the consultation meetings and acknowledging that the employee was given the opportunity to suggest alternatives to redundancy. This demonstrates that the consultation was genuine and not merely a formality.
Third, where the redundancy involves a pool of employees, the letter should describe the selection pool and the selection criteria applied, and explain how the employee scored against those criteria. This transparency is important both as a matter of fairness and to enable the employee to understand the basis of the decision if they wish to appeal.
Fourth, the notice period and last day of employment must be clearly stated. The notice period must comply with the employee's contractual notice entitlement and the minimum statutory notice requirements under Section 86 of the Employment Rights Act 1996, whichever is greater. If the employer intends to place the employee on garden leave or make a payment in lieu of notice, this must also be stated.
Fifth, the employee's statutory redundancy pay entitlement must be set out, calculated in accordance with Sections 135–162 of the Employment Rights Act 1996 based on age, weekly pay (subject to the statutory cap), and years of service. Any enhanced redundancy payment above the statutory minimum should also be described.
Finally, the letter should address accrued annual leave, the return of company property, post-employment obligations under the contract of employment, and — as a matter of good practice — the right of appeal against the redundancy decision.
Additional compliance elements for a Redundancy Letter (UK) used in United Kingdom include: Under the Employment Rights Act 1996, the Employment Tribunal adjudicates workplace disputes. Section 94 of the Employment Rights Act 1996 provides the right not to be unfairly dismissed. The Advisory, Conciliation and Arbitration Service (ACAS) provides early conciliation under Section 18A of the Employment Tribunals Act 1996. The UK GDPR and Data Protection Act 2018 govern personal data handling. HM Revenue and Customs (HMRC) administers PAYE and National Insurance contributions under the Income Tax (Earnings and Pensions) Act 2003. Forms-legal.com provides this template as a starting point for United Kingdom-compliant documentation.
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Reference this free template in an article, syllabus, or research note:
Forms Legal. (2026). Redundancy Letter (UK) (United Kingdom) [Legal document template]. Forms Legal. https://forms-legal.com/uk/employment/contracts/redundancy-letter-uk
"Redundancy Letter (UK) (United Kingdom)." Forms Legal, 2026, https://forms-legal.com/uk/employment/contracts/redundancy-letter-uk.
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title = {Redundancy Letter (UK) (United Kingdom)},
year = {2026},
howpublished = {\url{https://forms-legal.com/uk/employment/contracts/redundancy-letter-uk}},
note = {Free legal document template. Based on Employment Rights Act 1996}
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Frequently Asked Questions
Under Section 139 of the Employment Rights Act 1996, an employee is dismissed by reason of redundancy if the dismissal is wholly or mainly attributable to one of two circumstances. The first is where the employer has ceased or intends to cease carrying on the business for which the employee was employed, either entirely or in the place where the employee is employed — this covers business closures and workplace closures. The second is where the requirements of the business for employees to carry out work of a particular kind have ceased or diminished, or are expected to cease or diminish — this covers situations where a role is no longer needed, or where fewer employees are needed to do a particular type of work. A genuine redundancy situation must exist for a redundancy to be lawful. If an employer uses redundancy as a pretext to dismiss an employee for another reason — such as performance or conduct — the dismissal will not be a genuine redundancy and may be found to be unfair by an Employment Tribunal.
Statutory redundancy pay is calculated under Sections 135–162 of the Employment Rights Act 1996 based on three factors: the employee's age, their weekly pay (subject to a statutory cap which is reviewed annually — for 2025/26 the cap is £700 per week), and their length of continuous service. The formula is: for each complete year of service while aged under 22, half a week's pay; for each complete year of service while aged 22–40, one week's pay; and for each complete year of service while aged 41 or over, one and a half weeks' pay. The maximum number of years counted is 20. Employees must have at least two complete years of continuous service to qualify for statutory redundancy pay. For example, an employee aged 35 who earns £600 per week (under the cap) with seven years' service would receive 7 × £600 = £4,200. Statutory redundancy pay is exempt from income tax up to £30,000 under Section 401 of the Income Tax (Earnings and Pensions) Act 2003.
Yes — individual consultation is always required before making an employee redundant in England and Wales, regardless of the number of employees being made redundant. The consultation must be meaningful and genuine: the employer must meet with the employee to explain the redundancy situation, allow the employee to put forward alternatives to redundancy, discuss the selection process, and consider any representations made by the employee before making a final decision. In practice, a minimum of two consultation meetings is regarded as good practice, though the appropriate duration of consultation depends on the circumstances. Where an employer proposes to make 20 or more employees redundant at one establishment within a period of 90 days or less, additional collective consultation obligations apply under Sections 188–198 of the Trade Union and Labour Relations (Consolidation) Act 1992 (TULRCA). Collective consultation must begin at least 30 days before the first dismissal takes effect for 20–99 redundancies, and at least 45 days for 100 or more redundancies. Failure to collectively consult can result in a protective award of up to 90 days' gross pay per affected employee.
An employer selecting employees for redundancy from a pool of employees must use selection criteria that are objective, fair, and consistently applied. Commonly used criteria include: skills, qualifications, and experience; performance and attendance records; length of service; and disciplinary record. Purely subjective criteria — such as 'attitude' without objective measurement — are more difficult to defend at an Employment Tribunal. Selection criteria that, directly or indirectly, discriminate on the basis of a protected characteristic under the Equality Act 2010 — such as sex, age, disability, race, religion, or pregnancy and maternity — will be unlawful. For example, last-in-first-out (LIFO) criteria may indirectly discriminate against younger employees, and attendance-based criteria may indirectly discriminate against disabled employees if disability-related absences are not discounted. The employer must also define the correct pool of employees — selecting from too narrow a pool, or arbitrarily excluding employees from the pool, is a common reason for unfair dismissal findings.
There is no specific statutory right to appeal against a redundancy decision equivalent to the right of appeal in a disciplinary context. However, the ACAS Guide on Redundancy strongly recommends that employers offer the right of appeal as a matter of good practice, and Employment Tribunals will take a failure to offer an appeal into account when assessing the overall fairness of a redundancy dismissal under Section 98(4) of the Employment Rights Act 1996. Where an employer does offer a right of appeal, the appeal should be heard by a manager who was not involved in the original redundancy decision. The fact that no appeal was offered or exercised may affect the question of procedural fairness, and in cases where procedural failings are otherwise minor, offering and conducting a proper appeal can be a significant factor in an Employment Tribunal finding a dismissal to be fair overall. Employers using this template are advised to offer a right of appeal as a matter of best practice.
Yes — an employer can place an employee on garden leave during the notice period, provided this is expressly permitted by the employee's contract of employment. Garden leave means the employee is not required to attend work or carry out their duties during the notice period, but continues to receive their full salary and contractual benefits. Garden leave is commonly used where the employer has concerns about the departing employee's access to confidential information, client relationships, or other business interests during the notice period. If there is no garden leave clause in the contract, the employer cannot impose garden leave unilaterally — doing so would be a breach of contract. Alternatively, if the contract contains a payment in lieu of notice (PILON) clause, the employer may elect to terminate the employment immediately and make a payment equivalent to the employee's salary for the notice period. Since 6 April 2018, all PILONs are subject to income tax and National Insurance contributions under the Finance (No.2) Act 2017, even where the contract does not contain a PILON clause.
This template is provided for informational purposes only and does not constitute legal advice. Laws vary by jurisdiction and change over time. Consult a qualified attorney for advice specific to your situation.Full disclaimer
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