Is redundancy the only way?
The Coronavirus Job Retention Scheme has helped many businesses since March but we now know that it will be coming to an end in October and unfortunately that means that we are starting to talk about redundancy more often as business are starting to think about what life after furlough means for them.
What is clear from the conversations we have had is that it’s the very last thing businesses want to do, small business are invested in their employees professionally and personally and they want to do the right thing by them but it can feel like redundancy is the only option while things are still so uncertain.
There are some possible alternatives to redundancy, they might not be suitable for all workplaces but then again, they might work for your business if you find yourself unfortunately having to think about your options.
Reducing working hours can be done in a temporary or permanent variation to an employees contract or by changing a contract to zero hours. The employee still retains their rights but would have less or no guaranteed hours.
Flexible working might have been something that up until know you thought would never work for your business but if it has do you really need an office and all the costs that come with it, maybe more flexible working could save your business money.
Pay reductions might not be an easy subject to raise but in many cases people on furlough have adapted to receiving 80% of their pay and may be willing to reduce their salary for the security of knowing they will stay employed.
Other financial reductions such as overtime, bonuses, commissions or pension contributions if enhanced payments are made could help with cash flow while business is slower than usual.
Unpaid sabbatical where although no pay is received an employee remains employed might give someone the chance to do something they have always wanted to but not had the time. You might even consider allowing them to take on some other paid work whilst on a break from your business.
Company furlough. Although the CJRS is coming to an end if your business has the financial means you may be able to offer some kind of company furlough where again other paid work could be undertaken.
If making redundancies does end up being the only way forward for your business then there are some ways to enhance that process too.
Voluntary redundancy may take some of the load away from the employer when having to make difficult decisions but you might also find that the people that put themselves forward have skills and experience that you cannot afford to lose. As an employer you don’t have to accept a voluntary offer if it doesn’t make good business sense but you would need to consider the affect that might have on your professional relationship.
Re-recruitment, if you do have to let someone go but there is the potential that in time you may be able to recruit. Employees who have been made redundant could be offered roles before they are advertised.
All of the options we’ve talked about have implications and need to be given careful consideration. There are correct processes that should be followed before implementing any of them. If you would like to talk to us about any of them we would be happy to have a chat with you.