Holding a consultation
By law, you must talk and listen to (‘consult’) any of your employees affected by redundancies, even if they're not at risk of redundancy themselves.
You should clearly explain the purpose of the consultation and how it will affect them.
No employees can be made redundant until after the transfer.
If you do not hold genuine and meaningful consultation before making redundancies, employees could make a claim to an employment tribunal for unfair dismissal.
If you're making fewer than 20 redundancies
If you're making fewer than 20 redundancies, you do not need to collectively consult unless there's an agreement to do so. However, it's still good practice to collectively consult if you can.
You must still consult your employees individually but you could also consult them in small groups.
If you're making 20 or more redundancies
If you're making 20 or more redundancies, you must first consult with a recognised trade union or employee representatives (‘collective consultation’) at least 30 days before making any redundancies. You must also consult your employees individually.
Check if you need to hold collective consultation
Collective consultation is where you must consult on your redundancy plans with any recognised trade union, or if there is not one, employee representatives.
You must collectively consult if all of the following apply:
- you're planning 20 or more redundancies
- the redundancies are in 1 establishment – not necessarily in your organisation as a whole, which may be much larger
- you plan to make the redundancies within a 90-day period
You should also consult with employees individually.
When you can start collective consultation
By law, collective consultation must start at least 30 days before anyone is made redundant.
If both employers agree, the new employer can start collective consultation with affected staff before they've transferred from their old employer.
If you start collective redundancy consultation before the transfer, you must:
- not select or dismiss any employee for redundancy until after the transfer
- continue consulting with staff representatives once the employees have transferred, if collective consultation has not been completed
- carry out individual consultation with affected employees after the transfer
Example of pre-transfer collective consultation
DiggingCo wins a contract to carry out pipe work for UtilitiesCo. They will take on staff from Excavate Ltd as part of the transfer but there will not be enough work for both sets of employees. DiggingCo decides there is potential for 22 redundancies. Before the transfer, DiggingCo and Excavate Ltd agree to begin consultation at an early stage. They consult with elected representatives and employees about the transfer and redundancies at the same time. No redundancies are made before the transfer.