Alternatives to Redundancy

No one likes to be told how to run their business, not least me and this article by no means intends to tell you how to run yours. It is however designed to assist in your thinking process in tough times when your first reaction, having considered the finances, is to reduce the labour bill because it’s the biggest business cost.

Before you make any decision meet with all your employees and tell them the situation exactly how it is – no secrets. Ask them for their solutions and consider these carefully. By involving and engaging them up front you are likely to get more commitment. No-one wants to lose their jobs and so they will undoubtedly think creatively to avoid this situation. Remember the effect of synergy.

As a starter you may want to propose to the employees any of the following as alternatives to redundancy:

· Concentrate on delivering exceptional customer service to retain existing customers.

· Ask employees for ideas to increase sales.

· Review the total hours of work. Consider a temporary cut in the total hours worked. For example, full-time employees working part-time hours on a temporary or permanent basis with a view to increased hours when and if the business performance improves.

· Ask employees to take unpaid leave.

· Stop recruitment

· Review the existing workforce skills to establish if they meet the vacancy needs and/or can be used in other business areas.

· Don’t replace or extend fixed term employment contracts.

· Ask for voluntary redundancies.

· Reduce and/or eliminate any overtime worked regularly or ad-hoc.

· Ask for voluntary pay cuts. Set the example from the organisation top.

· Put on hold any bonus payments depending upon the terms of such agreements.

· Retrain employees and transfer them to other departments or part of the business where the skills are needed.

To find out more, to receive advice or to receive a redundancy policy, procedure, respective forms and/or letters to assist you in implementing a potential redundancy situation contact us on 0208 8168 726.