In the recent case of Micro Focus Ltd v Mildenhall, the Employment Appeal Tribunal (EAT) has provided important clarification on when the duty to collectively consult under s.188 Trade Union and Labour Relations (Consolidation) Act 1992 (TULRCA) is triggered.
The key message is the duty is forward‑looking. It depends on what the employer is proposing at the material time, not on a retrospective count of redundancies across a 90‑day period. The EAT also confirmed that only employees of the same legal employer count towards the 20‑employee threshold, even within corporate groups.
For employers planning restructures, this decision reduces the risk that sequential or group‑wide redundancies could accidentally trigger collective consultation duties unless the same employer is proposing 20 or more dismissals within a 90‑day period.
The law
Where an employer is proposing to dismiss 20 or more employees at one establishment within 90 days or less, it must undertake collective consultation with employee representatives of the affected employees.
TULRCA specifically provides that in determining how many employees an employer is proposing to dismiss as redundant, no account should be taken of employees whose proposed dismissals consultation has already begun.
Facts
Mr Mildenhall was dismissed for redundancy in July 2022 during a restructuring across Micro Focus’s corporate group. More than 20 redundancies occurred over a 90‑day period, but across several legal entities and in different tranches.
Mr Mildenhall brought a claim in the tribunal, arguing that these redundancies collectively triggered the duty to consult. The tribunal agreed, looking backwards as well as forwards for 90 days to determine that the threshold had been reached. The tribunal awarded a protective award. Micro Focus appealed.
EAT decision
The EAT allowed the appeal. It held that the concept of “proposing” to dismiss requires a focus on what the employer is envisaging at the relevant time, for the future. It does not make any difference how many actual dismissals there were, when viewed retrospectively. The obligation to consult may therefore apply even if fewer than 20 employees are actually dismissed or if the dismissals actually do not occur within the 90-day period, but over a longer period. The tribunal was wrong to look backwards and forwards to construct a 90‑day running total.
However, the EAT did emphasise that tribunal should be alive to employers seeking to manipulate the result by making redundancies over a longer period or doing them in tranches. Sometimes evidence of what actually happened on the ground may lead to an inference of what was proposed at the relevant time.
The EAT held that the concept of “proposing” is not limited to a decision on one day – it can span a period of time. The EAT said “an employer who proposes, say, six dismissals on Monday, seven on Tuesday and eight on Wednesday may readily be said to be "proposing" 21 redundancies that week.”
The EAT confirmed that that the consultation obligations fall on the actual legal employer. A group cannot be treated as a single employer unless employees share the same employing entity.
Comment
This decision is helpful to employers in that it removes the uncertainty created by various tribunal decisions that had suggested employers must look backwards and forwards to determine whether dismissals occurring in separate tranches could combine to trigger consultation duties. The correct focus is on what the employer is proposing at the material time - meaning that the threshold depends on the employer’s forward‑looking intention rather than any retrospective tally of redundancies that have occurred within a 90‑day period.
At the same time, the EAT confirmed that redundancies across group companies cannot be aggregated: the duty applies only to employees of the actual legal employer, even within closely integrated corporate groups.
Employment Rights Act 2025 – changes afoot
In 2027, under the Employment Rights Act 2025, the threshold is due to change so that the obligation to collectively consult over redundancies will be triggered where an employer is proposing to dismiss as redundant within a period of 90 days or less either:
- 20 or more employees at one establishment; or
- at least the “threshold number of employees”
We don’t yet know what the threshold number of employees will be – we await regulations for this detail. However, we do know that this additional test will capture employers with redundancies across various establishments.
A failure to inform and consult under TULRCA risks a protective award of up to 90 days’ actual pay. Under the Employment Rights Act 2025, this award is being doubled to 180 days’ actual pay. We expect this to come into force imminently in April 2026.
Against the backdrop of these impending reforms, employers should ensure restructuring plans are carefully documented and that decision‑making around proposals is clearly evidenced from the earliest stages.
