Individual Redundancy Consultations in the UK: Legal Requirements & Best Practice

Even in a well-run small business, there are times when you need to reduce headcount because a role is no longer needed (not because the person has done anything wrong). That’s where redundancy comes in - and where many employers get nervous about the process.

One of the biggest legal and practical “make or break” steps is consulting properly with each affected employee. Done well, individual redundancy consultation helps you run a fair process, reduce the risk of an unfair dismissal claim, and protect your reputation with the remaining team.

In this guide, we’ll walk you through what individual redundancy consultation is, when you need to do it, what a compliant process looks like in practice, and the best-practice habits that keep the process clear and defensible.

What Is Individual Redundancy Consultation (And Why Does It Matter)?

Individual redundancy consultation is the process of meeting with an employee (or employees) who may be made redundant to:

• explain the business reasons for the proposed redundancy
• share the information they need to understand what’s happening
• invite their feedback and questions
• genuinely consider alternatives (including suitable alternative employment)
• consider ways to avoid redundancy (or reduce its impact)
• follow a fair selection process if more than one person is in a “pool”

Consultation isn’t just a courtesy meeting - it should be a real discussion. If your decision is already fixed and the meeting is treated as a tick-box exercise, it can undermine the fairness of the dismissal.

For small businesses, the benefits are practical as well as legal. A good consultation process can help you:

• spot alternatives you may have missed (reduced hours, redeployment, restructuring)
• avoid operational surprises (handover needs, business continuity)
• reduce the chance of disputes over pay, notice and redundancy payments
• handle sensitive conversations in a consistent way

It also ties into your wider “people paperwork” - for example, the wording in your Employment Contract and any redundancy procedure set out in your Staff Handbook Package.

When Do You Need Individual Redundancy Consultation?

In most redundancy situations, you should assume you need to carry out an individual redundancy consultation process before making a final decision to dismiss.

That said, redundancy consultation requirements can differ depending on the size of the redundancy exercise.

Individual Consultation Vs Collective Consultation

Individual consultation is the one-to-one process with each affected employee.

Collective consultation is a separate legal duty that applies when you are proposing to dismiss 20 or more employees at one establishment within a period of 90 days or less (under the Trade Union and Labour Relations (Consolidation) Act 1992).

Where collective consultation applies, there are additional steps and minimum timescales. In broad terms, you must consult for at least:

• 30 days before the first dismissal takes effect (where 20–99 redundancies are proposed), or
• 45 days before the first dismissal takes effect (where 100+ redundancies are proposed).

You’ll also usually need to notify the Secretary of State by submitting an HR1 form within the required timeframe. Even if collective consultation applies, you generally still need to consult with employees individually as well.

Common Scenarios Where Individual Consultation Is Needed

• A role is disappearing (e.g. you’re closing a function, automating tasks, losing a key contract, or reorganising work).
• You’re reducing the number of people doing the same work (meaning you’ll likely need a selection pool and criteria).
• You’re making one “unique” role redundant (you may still need to consider alternatives and consult fairly, even if there’s no pool).
• You’re restructuring and creating new roles that are similar but not identical (meaning you may need to consider “bumping”, slotting in, or alternative roles).

If you’re unsure whether what you’re doing is genuinely redundancy (as opposed to performance, misconduct, or capability), it’s worth pausing. If the underlying issue is performance, for example, you may need a different process altogether, such as Performance Improvement Plans.

When the legal risk is high (or emotions are running hot), tailored support can make the difference - that’s where Redundancy Advice is often a sensible investment.

How To Run An Individual Redundancy Consultation: A Practical Step-By-Step Process

A fair redundancy process usually looks like a sequence of steps, not a single meeting. The exact process will depend on your business, how many roles are affected, and how complex your restructure is - but the “core” is fairly consistent.

1) Plan Your Rationale And Your Proposed Structure

Before you meet anyone, get clear on:

• why the redundancy is happening (e.g. reduced work, cost pressures, restructure)
• what is changing in the business (the “new structure” vs the old one)
• which roles may be affected and why
• whether there is a selection pool (and who is in it)
• what your proposed selection criteria might be (if needed)

Tip: write this down in a short internal note. If the decision is challenged later, you’ll be glad you captured your reasoning contemporaneously.

2) Invite The Employee To A Consultation Meeting

Invite the employee in writing to a consultation meeting. In most cases, it’s best to clearly state that:

• redundancy is being proposed (not decided)
• the meeting is part of a consultation process
• they can ask questions and propose alternatives
• they may be able to bring a companion if your policy allows it (this is often offered as good practice, even where there isn’t a statutory right)

Keep the tone calm and factual. This isn’t a disciplinary process - the goal is transparency and fairness.

3) Hold The First Consultation Meeting (The “Proposal” Meeting)

In the first meeting, you’ll usually cover:

• the business reasons for the proposed redundancy
• the role(s) affected and the proposed timetable
• how selection will work (if there is a pool)
• what alternatives you’re exploring (redeployment, reduction in hours, etc.)
• what support is available (time to look for work, references, EAP if relevant)

Most importantly: give the employee time to respond, and don’t pressure them to agree on the spot.

4) If There’s A Pool, Apply Fair Selection Criteria And Share The Outcome

If you have more than one person doing similar work, you’ll often need a selection pool and criteria. Criteria should be:

• objective where possible (skills matrix, qualifications, documented performance)
• non-discriminatory (avoid criteria that indirectly penalise protected groups)
• evidence-based (you should be able to justify scores)

After scoring, meet again to explain the provisional outcome and allow them to challenge any scoring they believe is wrong.

5) Explore Suitable Alternative Employment

A key part of individual redundancy consultation is looking for suitable alternative roles, including:

• existing vacancies
• roles created by the restructure
• possible “trial periods” where relevant
• adjustments to a role that could make it suitable

This step is often where employers trip up. Even if the employee seems unlikely to accept a different role, you should still consider and discuss options properly - and document what was considered.

6) Hold A Final Meeting And Confirm The Outcome In Writing

Once consultation has taken place and you’ve genuinely considered feedback and alternatives, you can make a final decision.

If redundancy is confirmed, you’ll usually issue a letter confirming:

• the reason for dismissal (redundancy)
• the termination date
• notice arrangements (worked notice or PILON if applicable)
• redundancy pay (if eligible) and how it’s calculated
• holiday pay and any other final payments
• the right of appeal

Also make sure your notice approach is consistent with your contracts and statutory rules - redundancy notice periods can be easy to miscalculate if you’re juggling contractual notice, statutory notice and payroll cut-off dates.

What Should You Cover In Consultation Meetings? (A Simple Agenda You Can Reuse)

When you’re in the middle of a stressful restructure, it helps to have a repeatable agenda. Here’s a practical checklist for each consultation meeting.

Business Case And Context

• What has changed in the business (financial, operational, client demand, restructure)?
• Why does that change mean the role is at risk?
• What steps have already been taken to avoid redundancies (if any)?

Role Impact

• Is the role disappearing entirely, or is the number of roles reducing?
• What the “new structure” looks like.
• If duties are being redistributed, explain how and why.

Selection (If Applicable)

• Who is in the pool and why?
• What criteria will be used?
• How scoring will be evidenced and checked.

Alternatives To Redundancy

• Reduced hours, job share, pay reductions (only with agreement), temporary layoff (rare), sabbaticals.
• Redeployment options and current vacancies.
• Training options if there’s a near-match role.

Practicalities And Next Steps

• Timeline and next meeting date.
• What information you’ll provide after the meeting (notes, scoring, vacancy list).
• What you need from them (feedback, alternative proposals, questions).

Keeping meetings structured is not about being robotic - it’s about being consistent and fair, especially if you’re consulting with more than one employee.

Documentation And Communication: How To Keep The Process Clear (And Defensible)

In a redundancy situation, misunderstandings happen easily. People hear “my job is at risk” and emotions (understandably) run high. Clear documentation doesn’t just protect you legally - it also reduces confusion.

Documents You’ll Commonly Need

• At-risk letter (or consultation invite)
• Consultation meeting notes (dated, shared with the employee)
• Selection matrix and evidence (where there’s a pool)
• Vacancy list for alternative roles
• Outcome letter confirming redundancy (with appeal rights)

If you already have a written redundancy process in your handbook, follow it. If you don’t, that’s a prompt to tighten your overall employment documentation - your Workplace Policy framework can make future processes significantly smoother.

Communication Tips For Small Business Employers

• Don’t over-promise early. If something is still being assessed, say so.
• Avoid “surprise redundancies”. Consultation should feel like a process, not a single shock meeting.
• Be careful with internal messaging. What you tell the wider team should be consistent with what the affected employee hears.
• Keep a single point of contact. If multiple managers are speaking to the employee, ensure they’re aligned.

Remember: fairness is not just what you do - it’s also what you can show you did, using notes and clear written communication.

Common Legal Risks (And Best-Practice Habits To Reduce Them)

Most redundancy disputes aren’t caused by the redundancy itself - they’re caused by process issues, unclear communication, or a lack of evidence that consultation was meaningful.

1) Treating Consultation As A Done Deal

If the employee can show the decision was predetermined, the redundancy process may be criticised as unfair. Best practice is to:

• use “proposed” language until the final decision is made
• invite and respond to suggestions (even if you ultimately don’t accept them)
• document why alternatives weren’t feasible

2) Getting The Pool Wrong

Choosing the wrong selection pool (or not using one where it’s appropriate) can lead to unfairness arguments. A useful rule of thumb is: if multiple employees do similar work, consider whether they should be in a pool.

This is one of those areas where tailored advice matters, because “similar work” can be a grey area in real businesses.

3) Using Vague Or Biased Selection Criteria

Selection criteria should be clear and capable of being explained. Be careful with criteria like “attitude” or “flexibility” unless you can evidence them fairly and consistently.

Also watch out for discrimination risks (Equality Act 2010). Even unintentional “indirect discrimination” can happen if your criteria disadvantages a protected group without strong justification.

4) Ignoring Alternative Employment Options

Failing to properly consider alternative roles is a common pitfall. Best practice is to:

• actively search for suitable roles (not just rely on the employee to find them)
• share a vacancy list and discuss options in meetings
• record what was considered and why it wasn’t suitable (if applicable)

5) Mishandling Notice, Pay And Final Sums

Redundancy pay, notice pay, and holiday pay are often where the “admin” becomes a legal risk. Problems can arise when:

• there’s a disagreement about contractual vs statutory notice
• PILON is paid without a contractual right (or without handling it carefully)
• holiday calculations are wrong
• the employee doesn’t receive a clear breakdown of final pay

Having up-to-date employment paperwork (and consistent payroll processes) is key. If your terms are unclear, it’s often worth updating your Employment Contract templates so you’re not improvising during a restructure.

6) Skipping The Appeal Stage

An appeal isn’t just a formality - it can correct mistakes and show procedural fairness. Even if the outcome doesn’t change, offering (and genuinely considering) an appeal can reduce risk.

Key Takeaways

• Individual redundancy consultation should be a genuine discussion process, not a tick-box meeting after a decision is already made.
• In most redundancy situations, you should consult with each affected employee before confirming dismissal.
• A fair process usually includes: planning your rationale, meeting with the employee, sharing selection details (if relevant), exploring alternatives, and confirming the final outcome in writing (with an appeal option).
• Clear documentation (meeting notes, scoring matrices, vacancy lists, and outcome letters) helps you stay consistent and defensible if the decision is challenged.
• Common risk areas include getting the selection pool wrong, using subjective criteria, failing to explore alternative roles, and miscalculating notice or final pay.
• Where the situation is sensitive or complex, tailored Redundancy Advice can help you manage legal risk and run the process with confidence.

If you’d like help planning or running an individual redundancy consultation process (or reviewing your letters and documents before you start), you can reach us at 08081347754 or team@sprintlaw.co.uk for a free, no-obligations chat.