In Micro Focus Ltd v Mildenhall the Employment Appeal Tribunal (EAT) has revisited European case-law on collective redundancies and clarified when the obligation to carry out collective consultation is triggered for employers.
Previous redundancies do not need to be taken into account when deciding whether the collective consultation threshold of 20 or more employees has been met. The number of proposed redundancies is a ‘forward-looking’ question based on the employer’s plans for the future at the relevant time.
The duty to consult
The obligation to collectively consult over proposed redundancies is set out in s188 Trade Union and Labour Relations (Consolidation) Act 1992 (TULRCA). Where an employer proposes to make large scale redundancies of 20 or more employees within a period of 90 days or less, it must consult on its proposal with representatives of the affected employees and notify the Secretary of State. This is done using form HR1 which, from 1 December 2025, must be completed online via the government website)
The sanction for breaching these obligations is a punitive ‘protective award’ of 90 days actual pay per affected employee, representing a serious financial penalty for employers carrying out larger redundancy and restructure exercises. The maximum protective award is set to increase from 90 days’ to 180 days’ pay per affected employee in April 2026. Read our insight on the increase to protective award.
EU law
The s188 duty is derived from EU legislation and was ‘assimilated’ into UK law after Brexit. This means that UK employment tribunals are no longer legally obliged to interpret s188 in light of the wording and purpose of the originating EU legislation. While the EU legislation, and any case-law that has built up around it, can be used as tools to aid interpretation, a UK court or tribunal can ‘depart’ from EU law and reach different conclusions if it wishes to do so.
In the EU case of UQ v Marclean Technologies SLU (‘Marclean’) the European Court of Justice (ECJ) appeared to suggest that the 90-day period in which redundancies were proposed meant any rolling period of 90 days. This appeared to oblige employers to look both forwards and backwards from an individual dismissal to determine whether 20 or more dismissals were proposed during the 90-day reference period (and consequently, whether collective consultation was necessary).
This is potentially problematic where an employer makes a series of ‘staggered’ redundancies, where the first batch affects fewer than 20 employees, but subsequent batches within a 90-day period tip the overall number over that threshold. An employer might, in good faith, decide not to undertake collective consultation on the first batch of redundancies, never envisaging that more will be required within 90 days. Conversely, an employer might trip up by failing to take into account previous redundancies which it believes to be already accounted for, when considering the collective consultation threshold for subsequent batches.
The facts
The Claimant, Mr Mildenhall, was made redundant from his role with an international IT company in July 2022. He alleged that collective consultation should have taken place and claimed unfair dismissal and a protective award.
Mr Mildenhall stated that, when he and his colleagues were first alerted to redundancy proposals in November 2021, they were shown a spreadsheet listing affected employees (of which there were fewer than 20). Following an ‘intense period of planning’ in January 2022, including a decision to consolidate teams, employees were alerted to further potential redundancies. A second ‘master spreadsheet’ was made available (around March 2022) which seemed to indicate a proposal to make 45 employees redundant in a single business area.
Applying the principles in Marclean, the employment tribunal looked both forwards and backwards over a 90-day period and held that there must have been a prior proposal to make a minimum of 45 employees redundant, which had ‘crystallised’ in the January 2022 planning period. The employment tribunal held that collective consultation obligations had been triggered and Mr Mildenhall’s claims were upheld on this basis.
The EAT decision
When the employer appealed this finding, the EAT held that the employment tribunal had misapplied the Marclean decision. The EAT decided that Marclean was not in fact relevant to quantifying the number of redundancies contemplated in a 90-day period, and rather related to other parts of the originating EU legislation, and other aspects of the redundancy process.
The EAT focussed instead on the wording of s188 TULRCA. It held that the duty to collectively consult, as expressed in this domestic legislation, is ‘prospective’ or ‘forward-looking’ in nature. It looks ahead from a point in time and considers what an employer envisages will happen 90-days into the future. When thinking about the number of employees affected, an employer does not have to take into account dismissals which have already taken effect, or earlier batches of redundancies that have already been planned.
Comment
This clarification will be largely welcomed by UK employers. The EAT’s clear and relatively straightforward interpretation of s188 arguably makes it easier to determine when collective consultation obligations are triggered and less likely that employers planning redundancy dismissals will fall into error.
It is important to note though, that an employment tribunal may look back to earlier dismissals or proposed redundancies if it suspects that an employer has acted in ‘bad faith’ and has deliberately tried to avoid the obligation to collectively consult. It is as important as ever to contemporaneously record decision-making around redundancy planning and to document any changing circumstances.
If you have any concerns or questions about the redundancy process, or whether collective consultation obligations will be triggered by a restructure project in your organisation, please do not hesitate to contact our expert employment law solicitors.
