This factsheet was last updated in March 2014.
What is redundancy?
A genuine redundancy arises only when either there has been or there is going to be:
- a cessation of business
- a cessation of business at the employee’s site
- a reduction or cessation of work.
Redundancy is one of the most traumatic events an employee may experience. Announcement of redundancies will have an adverse impact on morale, motivation and productivity. The negative effects can be reduced by sensitive handling of redundant employees and those remaining.
The legal position
Both statute and case law determine redundancy obligations and rights. The main legislation governing redundancy includes:
- The Trade Union and Labour Relations (Consolidation) Act 1992
- The Collective Redundancies and Transfer of Undertakings (Protection of Employment) Regulations 1995 (SI 1995/2587)
- The Employment Rights Act 1996
- The Collective Redundancies and the Transfer of Undertakings (Protection of Employment) (Amendment) Regulations 1999 (SI 1999/1925)
- The Collective Redundancies (Amendment) Regulations 2006 (SI 2006/2387).
CIPD members can find out more on redundancy law in our Redundancy law FAQs.
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