Employment and HRUnited Kingdom

Free Redundancy Notice
Letter Template

Create a professional redundancy notice letter compliant with the Employment Rights Act 1996 and ACAS Code of Practice. Covers statutory redundancy pay, notice periods, appeal rights and time off for job hunting.

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What Is a Redundancy Notice Letter?

A redundancy notice letter is a formal written communication from an employer to an employee confirming that their position has been made redundant. Under the Employment Rights Act 1996 (Part XI), it constitutes the official notification that ends the employment relationship on the grounds of redundancy as defined in section 139 of the Act.

The letter serves several essential functions: it confirms the reason for redundancy, specifies the last day of employment and the applicable notice period, details the employee's financial entitlements including statutory redundancy pay, and sets out the right to appeal against the decision. It also addresses practical matters such as the return of company property, reference provision and time off for job hunting.

Issuing a properly drafted redundancy notice letter is a critical step in demonstrating that the employer has followed a fair procedure, as required by the ACAS Code of Practice on Disciplinary and Grievance Procedures. Failure to follow a fair process can result in the dismissal being found unfair by an employment tribunal, potentially leading to increased compensation awards.

What's Covered in This Template

Doxuno's UK Redundancy Notice Letter template includes all the essential sections needed to comply with the Employment Rights Act 1996 and ACAS best practice. Each section can be customised for your specific redundancy situation.

Employer and Employee Details
Full names, addresses, job title and employment start date
Reason for Redundancy
Business closure, workplace closure, diminished requirements or reorganisation
Notice Period and Effective Date
Statutory minimum notice under s.86 ERA 1996 with last day of employment
Selection Criteria
Objective, measurable and non-discriminatory criteria under Equality Act 2010
Consultation Summary
Record of individual consultation dates and outcomes
Alternative Employment
Suitable alternative roles considered under s.141 ERA 1996
Financial Entitlements
Statutory/enhanced redundancy pay, PILON, holiday pay and bonus
Company Property Return
Checklist of items to return including laptop, phone, keys and badge
Time Off for Job Hunting
Statutory right under s.52 ERA 1996 for employees with 2+ years' service
Reference Provision
Basic or comprehensive reference for prospective employers
Right of Appeal
Appeal deadline, process and right to be accompanied under ERA 1999
Statutory Redundancy Pay Guide
Calculation formula, weekly pay cap and tax-free threshold

How to Create a Redundancy Notice Letter

Creating a compliant redundancy notice letter requires attention to both legal requirements and practical details. Our template guides you through each section with clear prompts and built-in compliance notes. Follow these five steps to produce a professional letter.

1
Enter Employer Details
Provide the full company or employer name, registered address, and HR contact information including email and telephone number. This identifies the organisation issuing the redundancy notice and gives the employee a clear point of contact for any queries about the process or their entitlements.
2
Add Employee Information
Enter the employee's full name, home address, job title, department and continuous employment start date. The start date is essential for calculating statutory redundancy pay under s.162 ERA 1996 and determining the statutory minimum notice period under s.86 ERA 1996 (one week per year of service, up to 12 weeks).
3
Specify Redundancy Details
Select the reason for redundancy as defined under s.139 ERA 1996: business closure, workplace closure, diminished requirements or reorganisation. Set the last day of employment, the notice period, consultation dates and the objective selection criteria applied. Indicate whether suitable alternative employment has been offered.
4
Set Financial Entitlements
Enter the employee's complete years of service and weekly pay to calculate statutory redundancy pay. Choose between statutory and enhanced redundancy pay, select the notice pay arrangement (working notice, Payment in Lieu of Notice or garden leave), and add any outstanding annual leave entitlement or other payments such as pro-rata bonus.
5
Review and Download
Preview the completed letter in real time as you fill in each section. Review all clauses including the right of appeal, time off for job hunting and company property to return. Once satisfied, download the finished letter as a professional PDF ready to issue to the employee.

Legal Considerations for UK Redundancy

Redundancy in England and Wales is governed by a comprehensive statutory framework, principally the Employment Rights Act 1996 and the Trade Union and Labour Relations (Consolidation) Act 1992. Understanding the key legal requirements helps ensure your redundancy process is fair and defensible should it be challenged at an employment tribunal.

Important: This template is provided for informational purposes and does not constitute legal advice. For complex redundancy situations, collective consultation requirements, or high-risk cases, consult a solicitor or employment law specialist.

Reviewed by legal professionals. The content on this page and the template clauses have been reviewed by licensed solicitors in England and Wales to ensure accuracy and legal soundness for standard redundancy scenarios.

Fair Procedure Requirements

For a redundancy dismissal to be considered fair under s.98(4) ERA 1996, the employer must demonstrate a genuine redundancy situation, follow a fair consultation process, apply objective and non-discriminatory selection criteria, and consider suitable alternative employment. The ACAS Code of Practice provides guidance on what constitutes a fair procedure, and failure to follow it can result in a tribunal increasing any compensation award by up to 25%.

Statutory Redundancy Pay

Employees with two or more years of continuous service are entitled to statutory redundancy pay under s.135 ERA 1996. The calculation uses a formula based on the employee's age, length of service (maximum 20 years) and weekly pay (capped at a level set annually by the Secretary of State). The first portion of a redundancy payment up to a specified threshold is exempt from income tax. Enhanced redundancy schemes are common but must not discriminate on protected characteristics.

Collective Consultation Obligations

Where an employer proposes to make 20 or more employees redundant at one establishment within a period of 90 days, collective consultation obligations under s.188 of TULRCA 1992 apply. For 20-99 proposed redundancies, consultation must begin at least 30 days before the first dismissal takes effect. For 100 or more, the minimum period is 45 days. The employer must also notify the Secretary of State using Form HR1. Failure to comply can result in a protective award of up to 90 days' pay per affected employee.

Equality Act 2010 Considerations

Selection criteria and the redundancy process must comply with the Equality Act 2010. Criteria must not directly or indirectly discriminate on the grounds of age, sex, disability, race, religion, sexual orientation, pregnancy/maternity, or any other protected characteristic. Employees on maternity leave have additional protections, including priority for suitable alternative vacancies under reg.10 of the Maternity and Parental Leave etc. Regulations 1999.

Frequently Asked Questions

A redundancy notice letter is a formal written document issued by an employer to an employee confirming that their position has been made redundant. It sets out the reason for redundancy as defined under s.139 ERA 1996, the effective date of termination, the applicable notice period, financial entitlements including statutory redundancy pay, and the employee's right of appeal. It is a key document in demonstrating that a fair redundancy process has been followed.
A redundancy notice letter should be issued after the employer has completed a fair individual consultation process with the affected employee. Under s.86 ERA 1996, the statutory minimum notice period is one week for each complete year of continuous employment, up to a maximum of 12 weeks. The letter must be issued in sufficient time to comply with the applicable notice period, whether statutory or contractual (whichever is longer).
Statutory redundancy pay under s.162 ERA 1996 is calculated based on the employee's age, length of continuous service (maximum 20 years) and weekly pay (capped at a level set annually). The formula is: 0.5 week's pay per year of service while under age 22, 1 week's pay per year while aged 22-40, and 1.5 weeks' pay per year while aged 41 or over. The statutory redundancy payment is tax-free up to a specified threshold.
Employers must carry out individual consultation with each affected employee, regardless of the number of redundancies. This means genuinely consulting about the reasons for redundancy, the selection criteria, whether there are alternatives to redundancy, and any proposals the employee may have. For 20 or more redundancies at one establishment within 90 days, collective consultation obligations under TULRCA 1992 s.188 also apply, requiring minimum consultation periods of 30 or 45 days.
Selection criteria must be objective, measurable and non-discriminatory under the Equality Act 2010. Common criteria include length of service, attendance record, disciplinary record, skills and qualifications relevant to remaining roles, and performance appraisal scores. Using criteria such as "last in, first out" alone may constitute indirect age discrimination. The criteria should be agreed upon before the selection process begins and applied consistently to all employees in the selection pool.
Yes, employees should be given the right to appeal against a redundancy decision as part of a fair process. The appeal should be heard by a more senior manager who was not involved in the original decision. Under s.10 of the Employment Relations Act 1999, the employee has the right to be accompanied at the appeal hearing by a fellow worker or trade union representative. While not a strict legal requirement for redundancy, offering an appeal is considered best practice by ACAS and tribunals.
Payment in Lieu of Notice (PILON) is a lump-sum payment made by the employer instead of requiring the employee to work their notice period. It is equivalent to the basic pay the employee would have earned during the notice period. Whether the employer can make a PILON depends on the terms of the employment contract. Where there is a contractual PILON clause, the payment is treated as earnings and is subject to income tax and National Insurance contributions in full.
Yes, under s.52 of the Employment Rights Act 1996, employees with two or more years of continuous service who are under notice of dismissal by reason of redundancy have a statutory right to reasonable paid time off during working hours to look for new employment or to arrange training for future employment. The maximum statutory entitlement for this time off is 40% of a week's pay, regardless of the amount of time off actually taken.

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Generate a professional redundancy notice letter in minutes. Our UK template covers statutory redundancy pay, notice periods, appeal rights and all ACAS best practice requirements under the Employment Rights Act 1996.

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