Redundancy with no consultation: a small employer's costly mistake
A graphic designer was told her role was redundant in a five-minute meeting with no warning, no consultation and no consideration of alternatives. The tribunal awarded £14,200.
1 min read · Last updated 17 May 2026
Key facts
- The agency genuinely faced a redundancy situation — the loss of a major client was not disputed
- No advance warning of the redundancy was given
- There was no individual consultation
- An alternative role was available and was not offered
- No appeal was provided
Timeline
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First sign of trouble
The agency lost its largest client, accounting for around 40% of monthly revenue. No staff communication followed.
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The five-minute meeting
The managing director called the claimant into his office and told her the role was redundant with immediate effect, offering one month's notice and a statutory redundancy payment.
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No alternatives discussed
The claimant asked whether she could move into a junior account-management role that was open. She was told the decision was already made.
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Written confirmation
A confirmation letter set out the redundancy. There was no appeal offered.
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Tribunal judgment
The tribunal found the dismissal unfair due to a complete absence of consultation and no consideration of alternative employment.
The legal issue
Whether a genuine redundancy situation excuses an employer from the obligation to consult — and whether failure to consider alternative employment makes an otherwise valid redundancy unfair.
The outcome
The tribunal accepted that redundancy was a genuine reason — section 98(2)(c) ERA 1996 was satisfied. The diminishing requirement for graphic design work was real.
But genuine redundancy does not excuse procedural failures. Even in a small business with no collective consultation obligation (which only applies at 20+ proposed redundancies in a 90-day window under TULRCA 1992), individual consultation is required.
The Polkey question — would she have been dismissed anyway with a fair process? — was answered partially. The tribunal found there was a 40% chance she would have been redeployed into the junior account-management role had it been properly offered. Compensation was therefore reduced by 60% to reflect the chance she would still have been made redundant.
Final compensation: £14,200 (basic award £4,200 + compensatory award £10,000 after Polkey reduction).
Lessons & takeaways
- Being a "small business" is not a defence to a failure to consult — the duty applies regardless of company size.
- Even one or two short consultation meetings can make the difference between a fair and unfair redundancy.
- Suitable alternative employment must actively be offered, not waited to be asked about by the employee.
- Polkey deductions can substantially reduce awards in redundancy cases where the redundancy itself was genuine.
What "consultation" really means
People often imagine consultation as a long, formal process. In a small redundancy it doesn't have to be. The minimum looks something like:
- A meeting to explain the business reasons and warn that redundancy is a possibility
- A second meeting to discuss the proposed selection (if more than one person is in the pool)
- A meeting to explore alternative employment within the business
- A final meeting to confirm the decision, with a right of appeal
Two or three short meetings spread over a week or two would have been enough here. Instead the entire process was a single five-minute conversation, which gave the tribunal almost no choice but to find the dismissal unfair.
The alternative role question
The single most damaging fact for the employer was that an alternative role existed and wasn't offered. The claimant explicitly raised it; the response was "we've already decided." That sentence is almost a guarantee of an unfair dismissal finding — it shows the employer treated the meeting as an announcement rather than a consultation.