Employment Rights Act 2025: consultation launched on threshold for triggering collective redundancy obligations

The Government has launched a consultation to determine the new organisation-wide thresholds that will trigger collective redundancy. The consultation closes on 21 May 2026. The measures are not anticipated to take effect until 2027.

Currently, under the Trade Union and Labour Relations (Consolidation) Act 1992, employers are only required to undertake collective redundancy consultation and notify the Secretary of State when they propose 20 or more redundancies within a 90-day period "at one establishment".  

The Employment Rights Act 2025 will amend the current collective redundancy framework so that employers must undertake collective consultation and notify the Secretary of State when proposing to dismiss as redundant within a 90 day period or less:

• 20 or more employees at one establishment (this is the same as current law) or
• at least a threshold number of employees across an entire organisation (the threshold number will be set out in regulations).

If the organisation wide trigger is met, the employer will be required to undertake collective redundancy consultation and notification, even if there are fewer than 20 redundancies proposed within a single establishment.

The intention is to strengthen redundancy rights and protections and provide certainty and clarity to employers and employees.

The government has set out four potential methods to set the threshold, which include:

1. a single fixed number of proposed redundancies across the business;
2. a percentage of the total number of employees;
3. a fixed number based on number of employees; and
4. a combination of fixed and percentage, depending on the size of the organisation.

The Government is minded to use a single fixed number to set the organisation wide threshold (option 1), and considers that the level of the trigger should be between 250 – 1,000 proposed redundancies.  Views are sought on this point.

The Government has also considered an option to set the level of organisation-wide threshold by applying fixed numbers according to the size of the employer (option 3), as follows:

• 250 redundancies for organisations with 0–2,499 employees.
• 500 redundancies for organisations with 2,500–9,999 employees.
• 750 redundancies for organisations with 10,000 or more employees.

The thresholds are much higher than anticipated, leading to commentary that the proposals are business friendly.

The government is seeking responses from all interested parties including individuals, employers, trade unions, and business representatives. We recommend engaging with the consultation if it is likely to impact you or your organisation.