In today’s response to consultation the Government has announced that the minimum consultation period for the largest scale collective redundancies will be reduced from 90 to 45 days. The consultation period for smaller redundancy exercises (ie between 20 and 100 redundancies over a 90 day period at a single establishment) will remain at 30 days. It plans to implement this change with effect from 6 April 2013.
In the consultation responses many had urged the Government to consider other legal changes, for example to clarify the definition of establishment for these purposes. For the most part, it has ruled this out. Instead it hopes that a non-statutory code of practice, to be drafted by ACAS, will help promote greater legal certainty. The only exception relates to the position of employees on fixed-term contracts, where the plan is to legislate so that the expiry of a fixed-term contract at its pre-agreed termination point will not trigger the obligation to consult.
It is worth emphasising that this change affects only the minimum consultation period. In large and complex redundancy exercises it may be necessary for the employer to exceed the new 45 day period to ensure that there is genuine consultation, as the law requires. In addition, while the minimum period is being reduced, the original consultation made it clear that there were no plans to reduce the maximum protective award. This will remain at 90 days’ pay.