What about retaining or retraining as an alternative to redundancy?

Over recent months many companies have been forced to consider their staffing requirements, given the economic downturn.  For many employees this is a time of great insecurity and low morale.  But is there an alternative to incurring the costs associated with a redundancy programme? 

By assessing the efficiency and effectiveness of each department, a company can consider moving employees from a quiet department into a department that is busy.  This avoids the company paying overtime rates and/or recruiting additional staff.  In turn this can result also in increased productivity and profitability.

As alternatives to redundancy, a business can also consider placing a temporary ban on any overtime and no longer engaging the services of agency workers. 

A company may also give consideration to whether any employees can be retrained and consider the costs associated with this.  It may therefore be worthwhile meeting with employees to establish if they possess any skills or qualifications of which the company is unaware and can be used within the business.  

In addition, a company should also consider whether any employees are approaching  retirement age within the next six to twelve months and if so, issue notice of the intended retirement date.  Any employees on long-term sick should also be addressed, particularly those who are in receipt of contractual sick pay.  Medical evidence can be sought to determine whether the employee is capable of returning to work. 

Employees may be willing to accept a temporary variation in hours and pay rather than be at risk of redundancy, however any such variation should be agreed by the employee and documented accordingly.

If the company is in a position whereby it must consider making compulsory redundancies then it can ask for volunteers.  The danger of doing so being that the company may lose valuable skills, although an application for voluntary redundancy does not have to be accepted.

Please contact our Employment Team if you require any further information as to how a redundancy programme may be reduced or avoided.

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