Redundancy Notice (UK)

A Redundancy Notice in the United Kingdom records an employer decision affecting an employee's engagement and the reasons and procedure followed, and is governed by the Employment Rights Act 1996. The legal framework governing redundancy in England and Wales is principally found in the Employment Rights Act 1996 (ERA 1996) and the Trade Union and Labour Relations (Consolidation) Act 1992 (TULRCA 1992). Under Section 139 of the ERA 1996, a dismissal is by reason of redundancy where the employer has ceased or intends to cease carrying on the business for which the employee is employed, or where the requirements of the business for employees to carry out work of a particular kind have ceased or diminished. A genuine redundancy situation must exist — redundancy cannot be used as a pretext to dismiss an employee for a different reason, such as poor performance or a personality conflict. Employees with at least two complete years of continuous service are entitled to statutory redundancy pay under Sections 135–165 of the ERA 1996, calculated by reference to the employee's age, weekly pay (subject to the statutory cap), and length of service. In addition to the financial entitlement, employees with at least two years of continuous service have the right not to be unfairly dismissed, meaning that a redundancy dismissal must be both substantively fair (a genuine redundancy exists) and procedurally fair (a fair process was followed). For larger redundancy exercises involving 20 or more employees at one establishment within 90 days, the collective consultation obligations under Sections 188–198 of TULRCA 1992 apply in addition to individual consultation. These obligations include a minimum consultation period of 30 days (or 45 days for 100 or more redundancies), notification to the Secretary of State by form HR1, and consultation with appropriate employee representatives. The statutory right to paid time off to seek new employment under Section 52 of the ERA 1996 — available to employees with at least two years' service — must also be addressed in the redundancy notice, as this is a benefit to which the employee is entitled as soon as notice is given. The legal framework governing the Redundancy Notice (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 Notice (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.

A redundancy notice must be issued whenever an employer in England and Wales has completed a genuine and lawful redundancy process and wishes to formally terminate an employee's employment by reason of redundancy. The notice must only be issued after the consultation process — whether individual or collective — has been genuinely completed, meaning that the employer has considered the employee's representations, explored alternatives to redundancy, and made its final decision.

Common circumstances giving rise to redundancy in England and Wales include: a business or workplace closure, where the employer is shutting down entirely or closing a particular location; an organisational restructuring or reorganisation, where certain roles no longer exist in the new structure; a reduction in business volume or revenue requiring a reduction in headcount; the introduction of technology, automation, or outsourcing that removes the requirement for certain roles; or a merger or acquisition that creates duplicate functions.

Before issuing a redundancy notice, the employer should have completed all of the following steps: identified a genuine redundancy situation within the meaning of Section 139 of the ERA 1996; given at-risk notice to all potentially affected employees; defined the selection pool; applied fair, objective, and consistently applied selection criteria to determine who is at risk; carried out meaningful individual consultation with each at-risk employee — typically at least two or three meetings at which the employee has the opportunity to put forward alternatives and challenge the selection; considered any alternatives to redundancy, including redeployment, reduced hours, and voluntary redundancy; and, in large-scale redundancy exercises involving 20 or more employees within 90 days, carried out collective consultation under Sections 188–198 of TULRCA 1992 and notified the Secretary of State by form HR1.

The redundancy notice should be issued at the conclusion of the consultation process, once the employer has made its final decision to proceed with the redundancy. Issuing a notice before consultation has genuinely concluded — or, worse, on the same day that consultation ostensibly begins — is a significant procedural error that is likely to result in a finding of unfair dismissal.

A legally compliant redundancy notice for use in England and Wales must contain a number of essential elements to be both procedurally and substantively fair.

First, the notice must clearly identify the reason for the redundancy, using language that tracks the statutory definition in Section 139 of the ERA 1996. A specific account of the business circumstances — for example, the closure of a particular site, a reduction in client orders, or the elimination of a specific function following a restructuring — is far more defensible before an Employment Tribunal than a vague reference to 'operational requirements'.

Second, the notice must summarise the consultation process that has been carried out. For individual redundancies, this means confirming the dates of the consultation meetings, the employee's opportunity to put forward alternatives, and the representations considered. For collective redundancies involving 20 or more employees within 90 days, the notice must also confirm that collective consultation was carried out under TULRCA 1992, identify the representatives consulted, and confirm that the Secretary of State was notified by form HR1.

Third, where the redundancy involves a pool of employees, the notice must describe the selection pool and the selection criteria applied. The criteria must be objective, fair, and consistently applied. Criteria that indirectly discriminate on the basis of a protected characteristic under the Equality Act 2010 — such as criteria that disadvantage part-time workers (who are disproportionately female) or disabled employees — must be justified as a proportionate means of achieving a legitimate aim.

Fourth, the notice must state whether any suitable alternative employment was considered and offered. Where an alternative role is offered, the notice must inform the employee of their statutory right to a four-week trial period under Section 138 of the ERA 1996 and of the consequences of unreasonably refusing a suitable alternative under Section 141.

Fifth, the notice must confirm the employee's entitlement to statutory time off to seek new employment under Section 52 of the ERA 1996, which is available to employees with at least two years of continuous service.

Sixth, the notice must state the notice period being given, the last day of employment, and the notice arrangement — whether the employee will work their notice, be placed on garden leave, or receive a payment in lieu of notice.

Seventh, the notice must set out the statutory redundancy pay entitlement in full, calculated in accordance with the formula in Sections 135–162 of the ERA 1996 based on age, weekly pay (subject to the statutory cap), and years of service. Any enhanced redundancy payment above the statutory minimum must also be described.

Finally, as a matter of good practice in line with the ACAS Guide on Redundancy, the notice should offer a right of appeal against the redundancy decision, even though there is no specific statutory right of appeal in a redundancy context. A failure to offer an appeal may be taken into account by an Employment Tribunal when assessing the overall fairness of the dismissal. The forms-legal.com Redundancy Notice (UK) template covers the mandatory elements under Employment Rights Act 1996.