Labour Research October 2004

Features: Law queries

Redundancy and consultation

Our employer has just made 16 people redundant out of a workforce of 80. They did not consult with any of us first but just called these people in and told them they were redundant. Are they in breach of any regulations by doing this?

Where an employer is planning to make 20 or more employees redundant within 90 days, they have a statutory obligation to consult with trade unions or elected representatives. However, even where this does not apply, as in your case, employers should consult with either a representative or the individual employees if the redundancy is to be fair.

The guidance given by the EAT in the Mugford case (below) says that a dismissal for redundancy will normally be unfair where there is no consultation unless the employer can show that consultation would be "utterly futile". Consultation should take place when proposals are at the "formative stage" and give adequate information and time to respond.

The purpose of consultation is to try to avoid redundancies - it may be that there is an alternative to redundancy, or that an employee would be prepared to accept a different job. A tribunal will consider what consultation took place as part of the test of "reasonableness" of the dismissal.

* Mugford v Midland Bank [1997] IRLR 208.

* For further information, see LRD Booklet "Redundancy".