Collective Redundancy Just Got Twice as Expensive: Protective Award Doubles to 180 Days

From 6 April 2026, the maximum protective award for collective redundancy consultation failures doubles from 90 days to 180 days' uncapped pay per affected employee. If you've made redundancies recently — or plan to — the cost of getting the process wrong has just doubled overnight.

This change is part of the Employment Rights Act 2025 and came into force alongside several other employment law changes this week. Unlike National Living Wage or SSP updates, this one has received almost no coverage in mainstream business press. Many UK employers — and their HR advisers — don't know it happened.

Here's what changed, what it means in practice, and what you need to do.

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What Is a Protective Award?

A protective award is compensation ordered by an Employment Tribunal when an employer fails to follow the correct collective consultation process before making 20 or more employees redundant within a 90-day period.

UK law requires employers to:

• Notify HMRC via Form HR1 at least 30 days before the first dismissal (45 days if 100+ employees)
• Collectively consult with elected employee representatives or a recognised trade union for the minimum statutory period
• Consult in good faith — not just go through the motions
• Discuss ways to avoid or mitigate redundancies, not merely announce them

If an employer skips or shortchanges this process, affected employees can bring an Employment Tribunal claim. The tribunal can award a protective award of up to the maximum number of weeks' pay — with no weekly cap on what counts as a "week's pay".

That last point matters. Unlike basic unfair dismissal awards, which are capped at £700 per week, protective awards carry no statutory weekly cap. A director on £150,000 a year triggers a protective award of £12,500 per week. Multiply that by 180 weeks and multiply again by every affected employee.

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What Changed on 6 April 2026

Before 6 April 2026, the maximum protective award was 90 days (13 weeks) per employee.

From 6 April 2026, the maximum protective award is 180 days (approximately 26 weeks) per employee.

The change was introduced by Section 47 of the Employment Rights Act 2025, which received Royal Assent in October 2025. The commencement date — 6 April 2026 — aligned it with the broader employment law changes taking effect this month.

The practical impact:

Scenario	Before 6 April 2026	From 6 April 2026
20 employees at £30k salary, full award	£150,000	£300,000
50 employees at £25k salary, full award	£312,500	£625,000
100 employees at £40k salary, full award	£1,000,000	£2,000,000

These are maximum figures — tribunals can award less if some consultation took place. But in cases where employers have simply announced redundancies without any process, full awards are regularly made.

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Who This Affects

Any UK employer who may make 20 or more redundancies within a 90-day period.

This catches more businesses than many realise:

• Restructures and site closures — even if phased over several months
• Seasonal workforce reductions — if 20+ workers are let go within a 90-day window
• Insolvency situations — administrators and liquidators have been caught by this before
• Multiple smaller rounds — two rounds of 15 redundancies three weeks apart = 30 in 90 days

The 90-day aggregation rule is widely misunderstood. If you're making 10 redundancies in March and another 12 in May, you've triggered the collective redundancy threshold and must follow the process for all of them.

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Common Mistakes That Lead to Protective Award Claims

1. Announcing the outcome before consulting on the decision

Consultation must be "meaningful". That means telling representatives that the business is considering redundancies, sharing the reasons, and genuinely exploring alternatives. Announcing "we're cutting 30 jobs, here's a selection pool" is not consultation.

2. Failing to elect representatives

If you don't have a recognised trade union, you must arrange elections for employee representatives before consultation begins. Many employers skip this step entirely — which invalidates the entire consultation.

3. Not notifying HMRC on Form HR1

HR1 must be submitted before the first dismissal takes effect. Forgetting to file, or filing after dismissals start, is a criminal offence carrying an unlimited fine on the company and personal liability for directors. This is separate from the protective award claim.

4. Treating redundancy consultation as a formality

Tribunals are clear: consultation must happen while the outcome is still genuinely uncertain. Holding meetings to "tick boxes" while restructuring plans are already finalised is not consultation.

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What You Should Do Now

If you've already completed a collective redundancy process recently, check whether the consultation was genuinely meaningful. A protective award claim can be brought within three months of the last dismissal — and from October 2026, that window extends to six months.

If you're planning redundancies, make sure you:

1. Count the numbers carefully — remember the 90-day aggregation rule
2. File Form HR1 with HMRC before any dismissal takes effect
3. Arrange representative elections before starting consultation
4. Start consultation early — not after the decision is made
5. Keep detailed records of every consultation meeting, proposal considered, and response given

That last point matters more than ever. If a protective award claim is brought, your consultation records are your primary defence.

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How ComplianceAlert Helps

Changes like this one — doubling the protective award to 180 days — are exactly the kind of technical employment law update that gets lost in the noise of a busy tax year. The headline changes this week were National Living Wage and SSP. This one slipped through almost unnoticed.

ComplianceAlert monitors changes from the Employment Rights Act 2025, HMRC, the Fair Work Agency, and 12 other UK regulatory bodies — and sends you plain-English alerts when something that affects your business changes.

Take our free Compliance Score quiz to see how your business stacks up across employment law, health & safety, data protection and tax: compliancealert.co.uk/compliance-score

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Frequently Asked Questions

Does the doubled protective award apply to redundancies already underway before 6 April 2026?

The new limit applies to dismissals that take effect on or after 6 April 2026. If your consultation began before April 6 but dismissals complete after that date, you should seek legal advice on which limit applies — the transitional position is not yet settled by case law.

Is a protective award the same as unfair dismissal compensation?

No. They are separate claims. An employee made redundant without proper collective consultation can bring both a protective award claim and an unfair dismissal claim. The protective award is in addition to, not instead of, other compensation.

What if fewer than 20 employees are made redundant?

Collective redundancy consultation obligations only trigger at 20 or more redundancies in a 90-day period. Individual consultation obligations still apply for every redundancy, but the protective award mechanism is specific to collective redundancies.

Is there a cap on each employee's weekly pay for the protective award calculation?

No. Unlike the basic award in unfair dismissal (which is capped at £700/week), there is no weekly cap for protective award purposes. The award is based on actual weekly pay.

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Key Takeaways

• From 6 April 2026, the maximum protective award doubles from 90 to 180 days per employee
• There is no cap on weekly pay — this is uncapped compensation
• The change affects any employer making 20+ redundancies in a 90-day window
• Common consultation failures include announcing outcomes before consulting, skipping representative elections, and late HR1 filing
• Claims can be brought within three months of the last dismissal (extending to six months from October 2026)

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