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The EAT ruling in Microfocus Ltd v Mildenhall clarifies that the duty to consult on redundancies is based on employers’ future plans, not past dismissals.
Employment Law & HR|25 February 2025
Insight
The Employment Appeal Tribunal (“EAT”) has given some helpful guidance on which numbers count for the purposes of collective redundancy consultation– and therefore when the duty will be triggered. This is an area of law in which there has been considerable confusion for some time and so, in this article, we explain what the case means for employers looking to make large scale redundancies.
Under the Trade Union and Labour Relations (Consolidation) Act 1992 (“TULRCA”), collective consultation with appropriate representatives is required where an employer proposes to dismiss 20 or more employees at one establishment within a 90-day period or less.
Where 20 – 99 dismissals are proposed, the consultation period is 30 days; where 100 plus dismissals are proposed the period is 45 days.
There is also a requirement to notify the Secretary of State via form HR1.
For many years, it had been understood that this meant employers needed to look forward- to predict how many dismissals were likely to take place- but that employers did not need to include prior redundancies or those for which consultation had already begun. However, an ECJ decision in 2020 in the case of UQ v Marclean Technologies SLU caused considerable confusion about whether an employer was also required to look back and therefore calculate the actual number of redundancies over the 90-day period.
In Microfocus Ltd v Mildenhall the claimant was dismissed by reason of redundancy and brought claims of unfair dismissal and for a protective award under s.188 of TULRCA, arguing that he should have been subject to collective consultation as his employer had been proposing large scale redundancies within a 90-day period. The Employment Tribunal upheld his claims and awarded a 90 day protective award for failure to collectively consult. However, the company appealed to the EAT who issued their judgment in December 2025.
The EAT allowed the appeal -finding that the requirement to look back after the event is only appropriate when looking back at a series of dismissals to determine whether a redundancy situation met the definition of a collective redundancy. It said it was incorrect look both forward and back when determining the question of when the duty to collectively consult is triggered where there are staggered dismissals.
When looking at an employer who is contemplating redundancies, the EAT said that the correct question is what the employer was proposing for the future at the material time. There is no requirement to look backwards or forwards 90 days to artificially construct a threshold.
Furthermore, a “proposal” is not a single moment in time, and it can evolve. The ET must therefore determine, as a matter of fact and on a case by case basis, whether the employer was at any stage proposing 20 or more redundancies. This seems to be a subtle distinction- the duty to collectively consult is triggered by the employer’s forward looking intention, and not by a retrospective tally.
The case was therefore remitted back to the ET to reconsider whether the duty to collectively consult was triggered- applying this as the correct legal approach- in this case.
This case provides some welcome clarity on when the duty to collectively consult is triggered. The duty is to look forward- based on the employer’s plans at the relevant time. You do not necessarily need to look back at previous redundancies and add those together over a 90-day rolling period. However, the EAT expressly stated in their findings that ETs should look carefully at the evidence in each case to prevent employers from trying to stagger dismissals to avoid collective consultation obligations.
Employers should keep detailed records as to what decisions are made and when, so that any challenge to calculate the threshold can be robustly defended. This includes- crucially- the point at which any initial plans change or evolve.
For the employer in this case, the result meant that no protective award was due. Remember that the level of award will double (from 90 days to 180 days pay per affected employee) in April this year. This could be a very expensive mistake to make so legal advice should always be sought in redundancy planning. Remember also that failure to notify the Secretary of State via form HR1 amounts to a criminal offence.
Finally, the law is set to change in terms of thresholds and when collective consultation will be triggered under the Employment Rights Act 2025. These changes are not anticipated until 2027 but greater scrutiny will no doubt be applied to employer’s plans with a view to achieving more transparency and accountability.
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