YOU can’t avoid headlines about concerns around increasing redundancies as we draw closer to the end of the furlough scheme, but business owners have more options available to them which could be far more beneficial for their companies and their people.
The Coronavirus Job Retention Scheme is due to close at the end of next month, something which will leave a lot of employers contemplating whether they will need to ask some of their workforce to leave if it means the business can continue to operate. But it’s really important to understand why redundancy might not be the solution you’re after.
The team who’ve helped you grow to this place have been trained and are experienced. Launching a redundancy process may mean losing them to a competitor. And as things start to pick up again, you’ll need to replace them and finding and hiring staff is time-consuming and expensive.
There are also associated redundancy costs including notice pay, statutory redundancy pay and possibly enhanced redundancy pay. It can also be mired with pitfalls in scoring matrices and consultation, leading to risk for the employer.
Instead, consider ways of avoiding compulsory redundancies altogether - both at the outset and later as part of any redundancy consultation process. The types of things we’re suggesting to clients are agreeing flexible working arrangements like compressed or fewer hours or job-sharing, or sabbaticals with a small incentive payment like maintaining pension payments during leave.
Other short-term measures are lay-offs where you ask your employee to not work for a period of at least one day per week, although there needs to be provision in a contract for this course of action.
Retraining might be an option you’ve not considered. It should go without saying that restricting new recruitment and not using agency workers would also help. So could you support your existing people to learn new skills and transfer them to other work within the company?
If this is a route you chose, you’ll find you’re pushing at an open door. A recent PwC report Upskilling Hopes and Fears found over half of workers in Northern Ireland would completely retrain or learn new skills in order to improve future employability. This was the second highest in all the UK regions, behind only London.
Performance analysis with a view to productivity improvements could offset costs, as could other measures like moving employees to another site.
Care should be taken when implementing the above changes in particular where certain benefits or terms are contractual, as the employee’s agreement may need to be sought in advance or there could be liability.
However if redundancy still remains a viable solution, then employers should consider voluntary redundancy.
It is important to note that employees who volunteer for redundancy will still count towards the threshold for collective consultation.
At times like these, preparation and advice is critical. The best thing to do might not be obvious but our specialist employment law team is helping business owners find out what’s available, where the risks are and how to go ahead with implementing changes, along with general workforce planning support.
Rebekah Primrose is PwC employment solicitor
