Collective redundancies: doubling of the protective award

From 6 April 2026, the maximum protective award that an employment tribunal (ET) can make for a failure to comply with collective redundancy consultation obligations will double from 90 days’ actual gross pay to 180 days’ actual gross pay per affected employee.

This change significantly increases the financial risk for employers who do not follow the collective consultation rules correctly, and makes getting the process right more important than ever.

The Government has indicated that the increased protective award will apply to any dismissals that take place on or after 6 April 2026. That is not clear from the legislation and another potential interpretation would be that it applies to consultation processes that commence on or after 6 April 2026. However, there is a significant risk that it will apply to any ongoing collective consultation processes that do not conclude until after 6 April 2026, and is therefore not to be ignored by employers who are carrying out or considering embarking on collective redundancy consultation processes.

What is a protective award?

A protective award is a remedy an ET can award where an employer has failed to comply with its statutory duty to inform and consult appropriate employee representatives in a collective redundancy situation.

If a protective award is made, the employer will be required to pay compensation to affected employees for a “protected period”. The length of that period is decided by the ET.

The ET has discretion when setting the award and will consider the seriousness of the employer’s failure. Where some steps were taken to consult, or where there were genuine obstacles to full compliance, this may reduce the length and therefore the value of the award. However, from 6 April 2026, the cap on that award will be significantly higher, increasing potential exposure for employers.

When do collective consultation obligations arise?

Collective consultation obligations currently arise where an employer is proposing to dismiss 20 or more employees as redundant at one establishment within a 90‑day period. In those circumstances, employers must consult appropriate employee representatives “in good time” and comply with the relevant minimum consultation periods.

Who the “appropriate employee representatives” an employer must consult are will depend on whether an employer is unionised or has an existing employee representative body:

• If there is a recognised trade union in respect of the affected employees then the employer must consult with that union;
• If there is an existing employee representative body, the employer can consult with that body provided that it can say the body was appointed or elected by the affected employees in such a way that it has authority from them to deal with redundancy consultation; or
• If there is no existing employee representative body (or any existing body is not properly constituted to deal with a redundancy process), the employer must carry out an election to appoint representatives specifically for the purposes of the collective consultation and in accordance with statutory requirements.

While the April 2026 changes do not alter these existing requirements and thresholds, they substantially increase the consequences of getting the process wrong.

Why does this matter for employers?

Doubling the maximum protective award significantly changes the risk profile of collective redundancy exercises. The potential financial exposure per employee is now twice as high, and because protective awards apply on a per‑employee basis, liability can escalate quickly in larger redundancy programmes. 

By way of example, if an employer runs a collective redundancy exercise affecting 30 employees, each earning £25,000 per year, the potential protective award could increase from roughly £185,000 to £370,000.

While ETs retain discretion when setting awards, the higher statutory maximum raises the stakes in cases involving rushed, late or superficial consultation (or none at all).

This reform is part of the Government’s wider programme of employment law changes being introduced by the Employment Rights Act 2025 during 2026 and 2027, aimed at strengthening worker protections and deterring non‑compliance.

Practical steps: what employers should be doing now

With the change taking effect imminently, employers should take proactive steps to reduce risk. These include:

• Review redundancy policies and procedures if you have them: If you have a redundancy policy, you may need to update it.
• Strengthen internal decision‑making and communication processes: A clear internal process can help employers identify when multiple proposed redundancies may be linked, to avoid inadvertently failing to collectively consult where it is required.
• Train managers and HR teams: Those involved in restructuring decisions should understand the purpose and importance of meaningful consultation, and the significantly increased financial consequences of non‑compliance from April 2026.
• Plan consultation early: Late or compressed consultation increases the risk of a protective award. Employers should build consultation timelines into project planning from the outset, rather than attempting to retrofit consultation once key decisions have already been made.
• Reassess risk in live processes: Where an employer is already engaged in a collective redundancy exercise, it should work on the assumption that the new protective award cap may apply and therefore pay particular attention to its collective consultation process.
• Take advice where uncertainty arises: Where it is unclear whether proposals trigger collective consultation duties, early advice can help mitigate risk and avoid costly mistakes (particularly in complex or phased redundancy exercises).

Looking ahead

The increase in the protective award is one of several collective redundancy reforms being introduced by the Employment Rights Act 2025. Further changes, including the introduction of an organisation-wide threshold for collective consultation, are expected to follow in 2027, subject to secondary legislation.

Employers should therefore view this change as part of a broader shift towards stricter collective redundancy obligations.

If you have any questions about how these changes may affect your business, please get in touch with your usual Womble Bond Dickinson contact or one of the authors.