Where employers are looking at making redundancies, they should consider the reasons for the loss of staff. This may be as a result of economic conditions or a loss of work. If there is a likelihood of an upturn in the economy, or a change in the business e.g. a new client, then the employer should consider a delay in making redundancies. Redundancies are not only a costly exercise, but the employer should consider that the loss of staff may result in a lack of skills within the business.
It is important that the employer identifies a potential risk of redundancies early. The first step should be to look at ways to prevent layoffs, these are known as alternative measures. These below options should be considered before any redundancies take place, including:
- Putting a recruitment freeze on all new roles and replacement roles for leavers. Reducing the recruitment of new and additional staff members could be a way to prevent making existing staff redundant.
- Reducing overtime available in the business. This can be temporary whilst the employer reviews its financial position. In this instance all employees impacted should be communicated to explaining the reason for this business decision. If overtime is contractual, then this needs to be more considered and managed appropriately, and where applicable unions and staff representatives communicated to.
- Reducing temporary workers and contractors. This can be the most immediate cost saving exercise, and less risky. Temporary workers and contractors are on a short notice period and therefore less risk of a claim or breach of contract.
- Considering Redeployment. Looking at moving employees into other areas of the business or other roles, either on a temporary or permanent basis can be an effective way of ensuring business continuity.
- Considering temporary layoffs/short-time working. Considering whether the business can ask employees not to work for a period of time or reduced hours. The employer should seek legal advice before making a decision, as there may be employment contractual implications e.g. lay off clause in contract, or requirement to pay during lay off.
- Offering voluntary redundancies. Can be a kinder option to offer staff as an alternative to involuntary redundancies.
In our ‘Redundancy Special’ week at Nockolds HR, we will be taking you through a week of redundancy related articles which outline each stage of the redundancy process. Coming up later this week are the further two articles:
- Closing the redundancy and providing outplacement support
Please contact us via email enquiries@nockoldshr.co.uk or call 0345 6460406 to speak to an experienced HR Consultant. Nockolds HR – Restructures and Redundancy.