Can a Majority Shareholder Remove a Director From a UK Company?

Yes. A majority shareholder can often remove a director from a UK limited company, but the correct legal procedure must be followed.

Under the Companies Act 2006, shareholders can remove a director by passing an ordinary resolution at a general meeting. This normally requires more than 50% of the eligible votes cast.

Does owning more than 50% guarantee removal?

Not always. The result depends on voting rights rather than simply the percentage of shares owned.

Before attempting removal, check:

• The rights attached to each share class
• The company’s Articles of Association
• Any shareholders’ agreement
• The director’s service or employment contract
• Whether any shares carry enhanced voting rights

A shareholder holding more than 50% of the ordinary voting rights will often have enough votes, but special voting arrangements may change the outcome.

What procedure must be followed?

Removing a director under the Companies Act normally involves:

1. Giving the company special notice of the proposed resolution
2. Sending a copy of the notice to the director
3. Calling a general meeting with the required notice
4. Allowing the director to make written representations
5. Giving the director an opportunity to speak at the meeting
6. Holding a shareholder vote
7. Recording the result in the company’s minutes
8. Notifying Companies House if the resolution passes

The company should carefully follow the statutory time limits and procedures.

What is special notice?

Special notice means the company must normally receive notice of the proposed resolution at least 28 days before the general meeting.

After receiving the notice, the company must send a copy to the director concerned. The company must also notify eligible shareholders of the proposed resolution.

Special notice is different from a special resolution. Removing a director normally requires an ordinary resolution, despite the requirement for special notice.

Can the director respond?

Yes. The director has the right to receive notice of the proposed removal, submit written representations and speak at the meeting.

Failing to respect these rights could make the removal open to challenge.

Can the director be removed by written resolution?

No. The statutory resolution to remove a director before the end of their term cannot be passed as a written resolution.

It must be considered and voted on at a properly called general meeting.

What voting majority is required?

An ordinary resolution normally requires more than 50% of the eligible votes cast.

For example, a shareholder controlling 60% of the company’s ordinary voting rights may be able to pass the resolution if all applicable procedures have been followed.

However, the Articles may contain weighted voting rights or other provisions affecting the calculation.

Must Companies House be notified?

Yes. If the director is removed, the company must normally notify Companies House within 14 days.

The termination can usually be reported online or by submitting form TM01. The company should also update its internal records and authorities for banking, contracts and business accounts.

Does removal cancel the director’s shares?

No. Removing someone as a director does not automatically remove them as a shareholder.

Directorship and share ownership are separate legal positions. A removed director may continue to:

• Own shares
• Receive dividends
• Vote as a shareholder
• Exercise rights under the Articles
• Benefit from a shareholders’ agreement

Any transfer or compulsory sale of their shares must follow separate legal and contractual procedures.

Does removal terminate their employment?

Not necessarily. A director may also be an employee or consultant of the company.

Removing them from the board does not automatically end their employment or service contract. The company may still face:

• Notice-payment obligations
• Contractual compensation
• Unfair dismissal claims
• Wrongful dismissal claims
• Claims under a shareholders’ agreement

The company should review all contracts before beginning the removal process.

Can the Articles provide another removal method?

Yes. The Articles may state that a director’s appointment ends automatically in certain circumstances, or they may allow the board to remove a director through a separate procedure.

However, the Articles generally cannot remove the shareholders’ statutory power to dismiss a director by ordinary resolution.

What if the majority shareholder acts unfairly?

A majority shareholder should use their voting power lawfully and comply with the company’s governing documents.

If removal forms part of conduct that unfairly harms a minority shareholder, it could lead to an unfair-prejudice claim or another shareholder dispute—particularly when the director is also a shareholder.

Final answer

A majority shareholder can often remove a UK company director by passing an ordinary resolution at a general meeting.

However, special notice must be given, the director must be allowed to respond and the company must follow the correct meeting and voting procedures. Removing the director does not automatically cancel their shares or terminate their employment contract.

Professional legal advice is recommended before removing a director, especially where that person is also a shareholder or employee.

This article provides general information and does not constitute legal or employment advice.

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