Appointing and removing directors is a routine but important part of running a company in England and Wales. Get the process right and it is straightforward; get it wrong (especially when removing someone) and you can face disputes and claims. Here is how it works under the Companies Act 2006.
Appointing a director
The way you appoint a director is set out in the company's articles of association. Under the common model articles, directors can usually be appointed either:
- by an ordinary resolution of the shareholders (a simple majority); or
- by a decision of the existing directors (the board).
The person must be willing to act, at least 16 years old, and not disqualified. There must be at least one director who is a natural person.
Once appointed, you must:
- notify Companies House within 14 days, using form AP01 (for an individual) or AP02 (for a corporate director); and
- update the company's register of directors and, where relevant, the PSC information.
Removing a director, handle with care
Removal is where problems arise, because a director may also be an employee and/or a shareholder, and removing them from the board does not automatically end those other relationships.
There are two main routes:
- Under the articles, the articles may allow the board or shareholders to remove a director in certain circumstances (for example, resignation, disqualification, or bankruptcy).
- By shareholders under section 168 of the Companies Act 2006, shareholders can remove a director by ordinary resolution, but this requires special notice (at least 28 days), and the director has the right to make representations and to be heard at the meeting. This statutory right cannot be excluded.
After removal, you must notify Companies House within 14 days using form TM01 (individual) or TM02 (corporate).
Watch the knock-on consequences
Removing a director can trigger other claims and obligations:
- Employment claims, if the director is also an employee, removal from the board does not end their employment; dismissing them may give rise to unfair or wrongful dismissal claims and notice/severance entitlements.
- Service agreement, check any director's service contract for notice and pay-in-lieu terms.
- Shareholder rights, if the director is a shareholder, a shareholders' agreement or the articles may contain "good leaver/bad leaver" provisions affecting their shares.
- Unfair prejudice, a removed director/shareholder in a small company may claim unfair prejudice if their removal breaches an understanding between the owners.
Practical guidance
- Follow the articles and the Companies Act process exactly, especially the section 168 special-notice procedure.
- Notify Companies House within 14 days (AP01/AP02 to appoint; TM01/TM02 to remove).
- Deal separately with any employment and shareholding consequences.
- Take advice before removing a director who is also an employee or shareholder.
Key takeaways
- Appoint directors per the articles (board decision or ordinary resolution); file AP01/AP02 within 14 days.
- Remove directors under the articles or by ordinary resolution with special notice under section 168 (which cannot be excluded); file TM01/TM02 within 14 days.
- Removal from the board does not end employment or shareholder rights, handle those separately.
- Beware unfair/wrongful dismissal and unfair prejudice risks.
Sources
- Companies Act 2006, section 168 (removal of directors by ordinary resolution) and provisions on appointment
- Companies House filing requirements (AP01/AP02; TM01/TM02; 14-day deadline)
- The law on directors' service contracts, unfair/wrongful dismissal, and unfair prejudice
--- This article is general information about the law of England & Wales as at 2026, not legal advice. For advice on your circumstances, consult a qualified solicitor.