Ten Top Tips: Avoid redundancies

Redundancies are often the first thing businesses turn to when they need to cut costs, but there are other options worth considering first. Here are ten ways to spare your staff from Su Makin, employment lawyer at Cobbetts.

by Su Makin
Last Updated: 09 Oct 2013

1. Take steps to eliminate voluntary overtime

Eliminating voluntary overtime is a simple way to reduce costs. However, HR must communicate with the workforce to ensure all employees know why overtime needs to be eliminated, as it may not please your employees if they have come to count on it as a regular part of their salary.

2. Recruitment freeze

In tough times it is necessary to work with the resources that you have in order to keep new costs down. This may mean taking advantage of natural wastage, not replacing exiting employees, reallocating workloads, and reshuffling workers in order to control headcount.

3.   Dispense with discretionary benefits

It is a hard truth but employee benefits may have to be re-evaluated. In boom years benefits were used to attract top employees, but this may not be as necessary in sectors where there are more applicants than jobs.  However, extreme caution should be taken if considering the removal of contractual benefits.

4.  Reduce the working week

Many businesses are saving money and keeping on employees by seeking agreement to operate on a four-day week for agreed periods.  It is important to regularly review the situation so that a return to full time working arrangements can take place at the earliest opportunity.

5.  Reduce working hours each day

If your business is unable to consider operating a four-day work week, then seeking agreement with employees to reduce the hours in a working day may be another option.

6.  Freeze or reduce pay for all staff

Freezing pay is an unpopular measure but it can be another way to avoid making redundancies. However, when freezing or reducing pay it is vital to balance this out by finding other ways of rewarding employees and boosting morale.

7. Promote job sharing arrangements

It may take creative solutions to help your employees through a recession. Job sharing arrangements allow multiple people to fill one job role. Its benefits include saving costs on pay roll and encouraging training and teamwork.

8. Identify and encourage secondment opportunities

Secondments are a fantastic way for staff to branch out and gain knowledge in a different role or field. The experience gained during secondments is priceless.

9.   Agree sabbaticals with senior staff

Sabbaticals seem more appealing than ever right now. Sabbaticals are often regarded as an important part of an employee’s career development, and may be granted for a variety of different reasons including study, research, travel or voluntary work.

10. Offer opportunity to purchase extra annual leave

Look at offering staff the opportunity to buy extra annual leave and sacrifice their salary on a pro rata basis to pay for it. Again, this may only be possible on a temporary basis and any arrangement needs to be clearly documented with allstaff concerned.

Su Makin is HR specialist on Cobbetts employment team.

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