“Quiet cutting” is the name given to reducing headcount without saying so. People are moved into lesser roles, lose their teams or their best work, or are relocated somewhere they can’t follow, in the hope that they resign. It can look cheaper than a redundancy process: no consultation, no notice periods, no announcement.
In the UK it often isn’t. Employment law judges what an employer did, whatever it called it. A resignation forced by the employer’s conduct can count as a dismissal, and a reorganisation that removes work is a redundancy situation even if nobody uses the word. This guide covers the rules in England, Wales and Scotland as they stand in October 2026, and the changes due in 2027. Northern Ireland has its own legislation. It is a summary, not legal advice.
Know when a resignation counts as a dismissal
Under section 95(1)(c) of the Employment Rights Act 1996, an employee is treated as dismissed if they resign in circumstances where the employer’s conduct entitles them to leave without notice. That is constructive dismissal.
Acas is direct about contract changes. If you impose a change before getting agreement, you are in breach of contract, and if the employee sees the change as a fundamental breach, they can resign and claim constructive dismissal at an employment tribunal. A demotion, a pay cut or a role stripped of most of its responsibilities are the kinds of change that can end there.
Before you change anyone’s role, write down what changes in their duties, pay, status and location, and get their agreement in writing.
Call a redundancy a redundancy
Section 139 of the same Act defines redundancy. A dismissal is by reason of redundancy when it is wholly or mainly because the business is closing, or because its need for employees to do work of a particular kind has ceased or diminished.
If roles are being emptied because the business needs less of that work, the business has a redundancy situation. Moving people sideways until they leave doesn’t change that. It only means the process the law sets out isn’t being followed.
The alternative is a restructuring done in the open: decide which work the business needs, which roles that leaves, and who is affected, then follow the process for that situation. It is slower to start and easier to defend.
- 1 Reason
Write down why roles must change
If the business needs less work of a particular kind, it has a redundancy situation, whatever the plan calls it (ERA 1996 s.139).
- 2 Agreement
Seek agreement to any new terms
Imposing a change without agreement is a breach of contract. A fundamental breach lets the employee resign and claim constructive dismissal (ERA 1996 s.95(1)(c)).
- 3 Count
Count the proposed dismissals
20 or more at one establishment within 90 days means collective consultation, including dismissing and rehiring on new terms (TULRCA s.188; Acas).
- 4 Notify
Send form HR1
Before any notice of dismissal is given, and at least 30 days before the first dismissal takes effect, or 45 days for 100 or more (TULRCA s.193).
- 5 Consult
Consult the representatives
From at least 30 or 45 days before the first dismissal. Failing to consult risks a protective award of up to 180 days' pay per employee (TULRCA s.189).
- 6 Decide
Decide, then give notice
Once consultation has covered ways to avoid the dismissals, reduce their number and soften their effects (TULRCA s.188(2)).
The rules in England, Wales and Scotland as at October 2026. A second threshold, counted across the whole employer, is due in 2027 once regulations set the number.
Source: Trade Union and Labour Relations (Consolidation) Act 1992, ss.188–193
Write down the business reason before any role changes. If it means less work of a particular kind, plan it as a redundancy from the start.
Count before you announce anything
Collective consultation under section 188 of the Trade Union and Labour Relations (Consolidation) Act 1992 applies when an employer proposes to dismiss as redundant 20 or more employees at one establishment within 90 days or less. Acas confirms that the duty also applies when you propose to dismiss 20 or more people and rehire them on new terms.
Two parts of that rule matter here. The count runs across a 90-day period, so several smaller changes can add up. And it is triggered by a proposal, not a final decision.
The Employment Rights Act 2025 adds a second threshold, counted across the whole employer as well as at each establishment. The number will be set by regulations that haven’t been made yet, and the government’s timeline puts the change in 2027.
Count every proposed dismissal, including dismissals with an offer to rehire, at each establishment over any 90-day period, and count again whenever the plan changes.
Notify and consult before anyone is told
Once you reach the threshold, two duties start. You must notify the government on form HR1 before you give notice of dismissal to anyone, and at least 30 days before the first dismissal takes effect, or 45 days if 100 or more employees are affected. Consultation with employee representatives must begin in good time, and at least 30 or 45 days before the first dismissal.
Consultation isn’t a briefing. Section 188 requires it to cover ways of avoiding the dismissals, reducing their number and softening their consequences, with a view to reaching agreement with the representatives.
If an employer fails to consult, a tribunal can make a protective award of up to 180 days’ pay for each employee affected. The maximum was 90 days until it doubled for dismissals on or after 6 April 2026.
Put the HR1 date and the start of consultation into the plan before you set an announcement date, and work backwards from the first dismissal.
Plan for the changes due in 2027
The government’s timeline lists several changes for January 2027 that raise the risk of forcing people out:
- The qualifying period for unfair dismissal falls from two years to six months, for dismissals from 1 January 2027.
- The cap on compensatory awards for unfair dismissal is removed.
- New protections against fire and rehire come in.
Together they mean more employees will be able to bring a claim, and the largest claims could be worth more. The new collective consultation threshold is due later in 2027.
If a restructuring will run into 2027, check which rules apply on the date each dismissal will take effect, and take legal advice before you fix the timetable.
Say what is happening
The people who stay see how the people who leave are treated. A restructuring announced plainly, with a reason, a process and dates, is harder in the first week and easier to defend for the months after. Forcing people out saves the first week and puts the rest at risk.
Running a restructuring well is a real test of a Head of HR. If you are hiring one to lead a change like this, our Head of HR search page explains how we run those searches.
Sources
- Employment Rights Act 1996, section 95, legislation.gov.uk: https://www.legislation.gov.uk/ukpga/1996/18/section/95
- Employment Rights Act 1996, section 139, legislation.gov.uk: https://www.legislation.gov.uk/ukpga/1996/18/section/139
- Trade Union and Labour Relations (Consolidation) Act 1992, section 188, legislation.gov.uk: https://www.legislation.gov.uk/ukpga/1992/52/section/188
- Trade Union and Labour Relations (Consolidation) Act 1992, section 189, as amended by the Employment Rights Act 2025 from 6 April 2026, legislation.gov.uk: https://www.legislation.gov.uk/ukpga/1992/52/section/189
- Trade Union and Labour Relations (Consolidation) Act 1992, section 193, legislation.gov.uk: https://www.legislation.gov.uk/ukpga/1992/52/section/193
- The Insolvency Service, “Advanced Notification of Redundancies – HR1 form”, gov.uk: https://www.gov.uk/guidance/advanced-notification-of-redundancies-hr1-form
- Acas, “If employment contract changes cannot be agreed”, updated 10 August 2026: https://www.acas.org.uk/changing-an-employment-contract/employer-responsibilities/if-employment-contract-changes-cannot-be-agreed
- Department for Business and Trade, “Plan to Make Work Pay and Employment Rights Act: timeline update”, updated 14 October 2026: https://www.gov.uk/government/publications/implementing-the-plan-to-make-work-pay-and-employment-rights-act/plan-to-make-work-pay-and-employment-rights-act-timeline-update