Facing redundancy at senior level: how to protect your position

Acas has predicted that around one third of UK employers expect to make redundancies by early 2027, rising to 46% among large organisations. This reflects a clear shift in board level thinking, with cost, structure, and strategy all under review.

Over the past few months, there has been a noticeable shift in the nature of conversations with senior executive clients. In the past, advice was sought on hiring, promotion, or carefully managed exits. Increasingly, however, employment lawyers are now more often brought into redundancy scenarios, at a much earlier stage than before, when clients are sensing greater uncertainty in their organisation and a feeling that something is shifting and priorities are changing.

In a world where organisations are focusing more and more on cost savings and changing business priorities, restructures are inevitable. In practice, this means more senior executives are coming under increased scrutiny, often with little warning and sometimes under the guise of a broader restructuring or changes in business focus and strategy.

At the same time, the external market has become more challenging, as other organisations are also seeking cost savings. Recruitment processes are taking longer, fewer roles are being openly advertised, and competition for senior positions is stronger than ever. Even very well credentialed executives are finding that securing the right next move is taking longer than expected.

That background is important to keep in mind when thinking about how to approach the first sign that something may be changing in your organisation. How senior executives handle the early stages of a redundancy situation is crucial, both for the results secured on exit and preparation for what follows.

What is changing from a legal perspective?

UK law is changing. The Employment Rights Act 2025 reforms, which are being implemented in stages during 2026 and into 2027, represent a significant change in the protections available for senior executives. From 1 January 2027, the statutory cap on unfair dismissal compensation will be removed, creating significant legal risk to employers who get dismissals wrong. In addition, unfair dismissal protection will arise after six months’ service rather than two years. Therefore any hires made on, or prior to, 1 July 2026 will have the right to bring an unfair dismissal claim as soon as the new rules take effect.

Businesses will now need to make quick decisions about the suitability of senior executives to avoid uncapped claims for significant losses. In practice, this may be difficult, as many senior roles take time to embed, and success is not often determined in the first few months. This creates an increased risk for employers, both legally and from a business perspective. Act too soon, and you could lose a future star performer; act too late, and you run the risk of substantial unfair dismissal claims. This is especially true in redundancy situations, when the rationale for dismissal is unclear or overlaps with issues such as performance or leadership change, which is common at the senior level and could render a dismissal for ‘redundancy’ open to challenge.

What the redundancy process looks like in reality

Most senior executives find themselves in one of two situations when they are called in to a meeting and placed ‘at risk’ of redundancy.

Either the meeting is a ‘without prejudice’ or ‘off the record’ conversation, with a brief explanation that the company is restructuring, reassessing future needs, merging or moving roles. It is often presented as an initial discussion, but the message is clear: the role is no longer required. The latter part of the meeting is then focused on an offer to reach an early settlement, and a proposal is put forward, often on terms that the senior executive feels are far from acceptable.

The other situation is more complicated. In this situation, the employer attempts to run through a ‘genuine consultation’, knowing full well they have made their decisions and are not going to entertain any proposals to avoid the redundancy. They then commence a more formal redundancy route, requiring multiple steps in an attempt to show not only a fair reason for the dismissal, namely redundancy, but also that they have followed a fair process.

How to approach option one (‘without prejudice’ route) strategically

1. Understanding the position

The first step is to properly understand what is driving the decision – is it a genuine redundancy or linked to something else, such as a change in leadership, a shift in board strategy, or unspoken concerns? Following up on the meeting with questions about the rationale, the selection process (including why you were personally selected), and any alternatives the company might consider to avoid redundancy are also useful at this early stage.

Even in a without prejudice scenario, it is entirely appropriate to probe and seek clarity. This will also help determine whether there are any potential claims for discrimination, whistleblowing or unfair dismissal, which can be used as leverage in negotiations that need to be factored into a settlement package. At this early stage, it is also time to re-familiarise yourself with your contractual position. Notice, bonus, equity and any good leaver provisions can be where significant value sits, and they are often not fully reflected in the initial proposal.

2. Avoid reacting too quickly

It is very common to feel pressure to engage immediately or to confirm whether you are willing to go down the settlement route, particularly when an offer is presented as reasonable or time-sensitive. In reality, the first proposal is rarely the final one, and there is more time than you are being led to believe to make decisions. Employers expect negotiation at this senior level. Taking time to consider your position and obtaining advice will almost always lead to a better outcome.

3. Negotiation and leverage

Many senior executives underestimate the leverage available to them. When a senior executive is being dismissed, businesses are not always solely focused on costs. They are focused on achieving a clean break, managing risk (commercial, reputational, and legal) and ensuring stability within the leadership team during what can be a period of uncertainty.

There is often real value in offering the business what it needs commercially. That might include agreeing on a clean, orderly exit, carefully aligning internal and external announcements, and giving the business confidence that you will support the agreed narrative and play the party line during the transition. In return, you should expect certainty on your side and an appropriate compensation package. That means a fully agreed and properly documented package, clarity on timing of payments, and appropriate treatment of bonus, equity, and benefits.

Handled properly, it is often possible to improve both financial and non-financial terms. That may include an increased ex gratia payment, more favourable bonus or equity treatment, continued benefits, or changes to restrictive covenants.

4. Financial planning

A redundancy at this level requires careful financial planning, particularly in the current market. While the first £30,000 of a redundancy payment can usually be paid free of income tax, notice pay, holiday pay, bonus and share vesting are typically taxable. Considering pension contributions can help manage tax exposure.

5. Career strategy and the market

It is important not to lose sight of the broader picture. The current market means that securing your next role may take longer than anticipated. Starting to activate your network early, in a controlled and thoughtful way, can make a real difference. Bear in mind your restrictive covenants when taking action on this, as you may need to wait a certain period before reaching out to certain contacts.

This is also a point where many clients step back and reassess. Redundancy is a natural opportunity for change. For some, the next move is another executive role. For others, it is a transition into consulting, portfolio work or a different type of leadership position. Being clear about your direction helps avoid simply reacting to the first opportunity that arises.

6. Reputation and messaging

At the senior level, reputation is critical, as it forms part of a professional’s identity and career success. Therefore, how your departure is communicated internally and externally should be managed carefully. It is often possible to agree on the narrative, including internal announcements and external messaging, to ensure consistency and eliminate uncertainty or negative inferences by colleagues and the wider market. A well handled announcement process helps preserve relationships and gives the business comfort during a period of change, while also positioning you strongly for your next move.

How to approach option two (formal redundancy route) strategically

1. Understanding the position

Where an employer opts to run a formal redundancy process, the framing will almost always be that there is a fair reason for dismissal and that a fair process will be followed. That framing is deliberate and is designed to narrow expectations around outcome, and position the employer as acting reasonably.

As with option one, it is critical to look beyond the stated rationale. At the senior level, redundancy is often only part of the picture and may sit alongside broader drivers such as changes in leadership, investor pressure, performance concerns or a shift in strategy. The same exercise applies here as under the without prejudice route; understanding what is really driving the process will inform both the strength of the legal position and the appropriate negotiation strategy.

A process presented as redundancy but influenced by other factors will often be more vulnerable to challenge than it first appears.

This is also the point, as with option one, to revisit contractual and incentive arrangements in detail. Notice, bonus, long term incentives and good leaver provisions frequently drive value and may not be reflected in how the employer is presenting the process, and therefore should be addressed early on.

2. Engagement in the process

While it may be tempting to disengage or treat the exercise as a formality, that is rarely the best approach. A senior executive should engage constructively, but with care and preparation. As in the without prejudice context, avoiding reactive decision making is key. Taking time to prepare for consultation meetings properly and seek advice will strengthen outcomes.

This means approaching consultation meetings with a clear understanding of the issues, asking targeted questions and putting forward reasoned representations. Creating a clear paper trail is important. This deliberate and constructive engagement allows you to test the genuineness of the redundancy situation, identify weaknesses, and, if necessary, demonstrate that your consultation has not been meaningful or genuine.

3. Testing fairness and identifying leverage

A redundancy process at this level will typically focus on the business rationale, the selection process, and the consideration of alternatives. Each provides an opportunity to test the robustness of the employer’s position.

In practice, this involves examining whether there is a genuine reduction in roles or simply a reallocation of responsibilities, whether any selection pool has been appropriately defined or artificially narrowed, whether alternative roles have been genuinely explored, and whether the outcome appears predetermined.

This is the equivalent, in the formal process, of the ‘leverage’ analysis under the without prejudice route. Many of the same considerations apply. The difference is that here, leverage is being built through the process itself. Weaknesses identified and recorded during consultation increase pressure on the employer and can be deployed in parallel negotiations.

4. Managing the risk of a predetermined outcome

In many senior redundancy cases, the decision is made early, and the formal process is used to support it. The strategic question is therefore whether the process is genuinely open or effectively a form of rubberstamping.

As with option one, where understanding employer motivation is critical, identifying signs of a predetermined outcome is key. These may include a limited or shifting rationale, resistance to alternatives or an accelerated timetable. Where these features arise, it is important to challenge constructively, ensure concerns are clearly recorded, and avoid endorsing the employer’s narrative. This mirrors the discipline under the without prejudice route, which is not to accept the employer’s initial framing at face value.

5. Using the process to shape negotiations

Even when an employer chooses the formal route, most senior exits are still resolved through a settlement agreement. The redundancy process and negotiation, therefore, run in parallel, rather than sequentially, with settlement negotiations.

This is where there is the greatest overlap with option one. The same commercial drivers apply. Employers remain focused on achieving a clean break, managing legal and reputational risk, and ensuring stability at the leadership level. A well handled approach uses the process to highlight those risks and demonstrate that a negotiated exit would provide a more certain and controlled outcome. In that sense, the strategy is similar to the without prejudice route, albeit reached by a different path.

6. Financial and timing considerations

Proceeding through a formal process has implications for both timing and financial outcome. As with option one, financial planning remains critical. Consider salary and benefits during the process, the timing of bonuses or vesting events, and how termination is characterised for the purposes of incentives. Structuring and timing can affect the value of the settlement package.

7. Reputation and internal positioning

A formal redundancy process at the senior level often creates internal uncertainty, therefore, and as with option one, reputation and messaging are critical. Maintaining a professional and measured approach supports credibility, preserves relationships, and strengthens your position. There is often scope, as in the without prejudice route, to influence how the situation is communicated internally and externally. Ensuring consistency of messaging and alignment with your longer term career objectives remains an important part of the strategy.

8. Keeping the broader strategy in view

Finally, the same broader career considerations apply. As under the without prejudice route, it is important not to lose sight of the wider picture. The process may enhance leverage, but it also takes time, can delay your next move, and may affect how you engage with the market. Activating your network in a controlled way, considering the impact of restrictive covenants, and being clear about your next step remain just as relevant here. The key is to balance maximising value with achieving a timely and well managed exit, in line with your overall objectives.

Final thoughts

Redundancy at the senior level is rarely just about the legal considerations and whether legislation has been adhered to. It is a commercial negotiation, and often a time to reflect on the direction of your career and your longer term career plans. Handled well, it can provide an opportunity to secure a stronger exit package, achieving clarity and certainty on your exit terms whilst protecting your reputation and positioning yourself for what comes next. Handled poorly, it can result in value being left on the table and a more difficult transition. Taking advice early and approaching the situation in a considered, strategic way tends to achieve better outcomes, both immediately and in your next move.