MICRO FOCUS ON WHEN COLLECTIVE CONSULTATION IS TRIGGERED

The Employment Appeal Tribunal’s decision in Micro Focus Ltd v Mildenhall provides important clarification on when the duty to engage in collective redundancy consultation under s.188 TULRCA is triggered. As organisations continue restructuring in an unpredictable economic climate, the judgment offers timely guidance for HR teams seeking to manage redundancy processes lawfully and effectively.

Background to the Case

Mr Mildenhall, a senior employee at Micro Focus, was made redundant following a period of organisational restructuring. He brought claims for unfair dismissal and for a protective award on the basis that Micro Focus had failed to comply with its duty to collectively consult.

The Employment Tribunal agreed with him, deciding that the employer was proposing 20 or more redundancies within a 90‑day period, and that consultation should therefore have taken place. This conclusion relied heavily on counting redundancies both backwards and forwards over a 90‑day window. Micro Focus appealed.

What the EAT Decided

The EAT allowed the appeal in part and issued the important clarification that collective consultation is a forward‑looking duty. The EAT held that an employer’s obligation to consult arises only when it is proposing, at that point in time, to dismiss 20 or more employees. It is not correct for tribunals (or employers) to look backwards to artificially construct the 90‑day threshold. This overturns the increasingly common interpretation of the ECJ’s decision in Marclean, which had been understood as requiring a forward and backward counting exercise.

What This Means for HR Professionals and employers

This decision offers greater certainty for employers planning restructures. The key practical implications are:

1. Focus on what you are proposing now

Assess whether you are currently proposing 20 or more redundancies within a 90‑day period, based on forward‑looking plans. Avoid retrospective counting exercises.

2. Document your reasoning

Contemporaneous records of restructuring proposals, headcount reduction plans and business cases will help demonstrate whether the 20‑employee threshold was reached at the point of each proposal.

3. Future‑proof your approach

With wider reforms coming under the Employment Rights Act 2025, including increased protective awards and revised consultation thresholds, employers should update internal redundancy checklists and trackers to ensure compliance.

If you would like tailored advice on upcoming restructures or support with updating your organisation’s redundancy policies, the team at Horsfield Menzies would be delighted to help.