This guide is maintained as a current resource for July 2026 and covers only the laws of England and Wales. Information is for general guidance, not legal advice. Consult a qualified solicitor for advice specific to your situation.
A detailed guide to when an employer can lawfully make staff redundant in England and Wales, explaining genuine redundancy, fair selection, consultation requirements, collective rules, suitable alternatives, lawful process risks and employment tribunal remedies.
In the law of employment in England and Wales, an employer may dismiss staff by redundancy only in specific, lawful circumstances. Redundancy is not a matter of convenience or employer preference; it arises when there is a genuine business need to reduce the workforce. This article explains when a redundancy is lawful, what employers must do, and what rights employees have. It is intended for solicitors, students and members of the public seeking clear, accurate guidance on redundancy law.
What Lawful Redundancy Means
A redundancy dismissal must be genuine - the role itself must no longer be required because the employer's need for employees to do that particular type of work has diminished or ceased. Redundancy can occur when a business:
- closes down permanently or relocates;
- reduces the number of employees carrying out certain work;
- changes the way it operates, such as introducing new technology that significantly reduces the need for particular roles; or
- restructures in a way that eliminates specific jobs.
The defining feature is a change in the business's need for work of a particular kind, not dissatisfaction with an individual employee's performance.
Establishing a Genuine Redundancy
For a redundancy to be lawful, an employer must have a legitimate business reason. Typical lawful reasons include:
- Reduced demand for work: there is less work available requiring fewer staff.
- Business closure: the business or part of it is shutting down.
- Operational change: restructuring or new systems reduce the requirement for certain roles.
- Relocation: the business moves to a different place where fewer or different employees are needed.
- Economic pressures: financial difficulties necessitate workforce reduction.
An employer cannot lawfully make someone redundant if they intend to replace them with another employee performing the same work. If another person is recruited to do the same job, this suggests the redundancy may not be genuine.
Fair Selection and Lawful Redundancy
When there is a pool of employees from which redundancies must be selected, the employer must apply fair and objective selection criteria. Typical lawful criteria include:
- length of service;
- skills, qualifications and experience;
- performance records;
- attendance history (objectively measured).
Selection must not be based on discriminatory factors, such as age, race, sex, disability, religion or belief, pregnancy or maternity status, or trade union membership, as doing so would make the dismissal unlawful.
An employer can make an individual redundant without a formal selection process if the job role itself no longer exists - for example, if the entire function is eliminated or there is only one person in that role.
Consultation: A Legal Requirement
A key element of lawful redundancy is consultation with affected employees. The employer must start consultation early in the process, while proposals are still formative, and before any final decisions are made. Consultation must involve:
- explaining why redundancies are proposed;
- discussing ways to avoid or reduce redundancies;
- considering alternatives to redundancy;
- giving employees an opportunity to make representations.
Individual Consultation
For fewer than 20 proposed redundancies at one establishment, there is no statutory minimum number of meetings, but employers must still consult individually with each affected employee. There is no strict statutory formula on how this must be done, but consultation must be meaningful and timely.
Collective Consultation
Where 20 or more redundancies are proposed within a 90-day period at the same establishment, collective consultation rules apply. This involves consulting with trade union representatives or elected employee representatives. Legal minimum consultation periods are:
- at least 30 days' consultation before dismissals take effect when 20–99 redundancies are proposed;
- at least 45 days' consultation for 100 or more redundancies.
Failing to consult properly can make dismissals unfair and lead to claims for compensation. In collective cases, tribunals can award protective awards of up to 90 days' pay per employee.
Suitable Alternative Employment
If there is another suitable role in the organisation, an employer should offer it to the employee at risk of redundancy. An employee can try the new role without losing their right to redundancy pay for a trial period, typically four weeks.
Refusing a suitable alternative role without good reason may affect entitlement to redundancy pay.
What Employers Must Avoid
A redundancy will not be lawful if an employer:
- uses redundancy as a pretext for dismissing someone for poor performance, disciplinary reasons, or to avoid employment rights;
- selects employees for redundancy on discriminatory grounds;
- fails to consult meaningfully or properly with affected staff;
- restructures in a way that does not genuinely reduce the need for the work in question.
Even in genuine redundancy, the process must be fair. Unfair processes can lead to claims of unfair dismissal at an employment tribunal.
Legal Remedies and Time Limits
Employees who believe their redundancy was unlawful can take action:
- Unfair dismissal claims: typically must be brought within three months (less one day) from the effective date of termination after completing Acas Early Conciliation.
- Protective award claims: for failure in collective consultation, also within three months (less one day).
- Discrimination claims: if redundancy involved discrimination, usually within three months (less one day) from the act complained of.
Employees should seek independent advice from Acas, Citizens Advice or a qualified employment law solicitor as early as possible.
Practical Steps for Employers
To ensure redundancy is lawful, employers should:
- Determine and document the genuine business reason for redundancy.
- Identify the pool of roles genuinely at risk.
- Apply fair, objective selection criteria.
- Consult with employees early and meaningfully.
- Consider alternatives, including redeployment and voluntary redundancy.
- Follow statutory collective consultation requirements where applicable.
- Offer suitable alternative employment, if available.
Questions Commonly Asked
Can an employer make someone redundant without consultation?
Lawful redundancy still requires consultation, even for small numbers of redundancies; lack of consultation can render the dismissal unfair.
Is redundancy lawful if the business is not failing?
Yes, redundancy may be lawful where roles are genuinely no longer needed, even if the business is still profitable, as long as the employer has a real operational reason.
What happens if someone is chosen for redundant for discriminatory reasons?
Dismissal on discriminatory grounds will be unlawful, and the employee may bring claims for unfair dismissal and discrimination.
Key Takeaways
An employer can lawfully make staff redundant only where there is a genuine reduction in the need for particular work and the redundancy process is conducted fairly. The process must include meaningful consultation, fair selection, consideration of alternatives and compliance with statutory collective consultation rules. Failures in process or discriminatory treatment can make a redundancy unlawful and expose the employer to tribunal claims. Employees have rights to challenge unlawful redundancy and should seek appropriate guidance promptly.
