Reducing business costs - alternatives to redundancy
23 May 2019
When businesses run into financial difficulties and need to reduce costs, the knee-jerk reaction is often to consider the scope for job cuts.
But redundancies are not a cheap option: the Chartered Institute of Personnel and Development estimates that they cost employers, on average, £16,375 per employee. If mistakes are made in the way redundancies are handled, further costs may be incurred on account of tribunal claims. Other drawbacks include the loss of valuable skills and experience and the negative impact on the morale of the staff that are retained.
Employers should therefore think creatively and look at other alternatives that may better suit the needs of their business. This Inbrief summarises some of the options and examines how to avoid falling foul of the legal procedures and obligations that might come into play.