Global uncertainty and the possibility of trading tariffs has led to a rather precarious economy and businesses finding themselves navigating through choppy waters.
At times of uncertainty, businesses often look at their staffing levels when considering cost cutting. This was clearly evident during the COVID-19 pandemic when the country was in lockdown. Whilst redundancies are the obvious route, they can be expensive and sometimes not without their own risks. Businesses should also consider the practical affect of losing skilled staff and the damage to morale.
An alternative approach to redundancies might be a recruitment freeze or lay-offs and short time working (LOST). Under LOST, work and pay are temporarily reduced to get the business through a short term downturn in work. This may not be appropriate where the reduction of work is likely to be long term and it also requires staff agreement or a contractual right to implement.
Other options to consider could be asking staff if they are willing to agree to a long term or permanent reduction in their hours and pay – if this is offered as an alternative to compulsory redundancy, staff may be willing to agree to it. This option will become more difficult with the upcoming Employment Rights Bill limiting fire and rehire options. When the new rules are in force, dismissals based on refusals to accept new terms will be automatically unfair unless the business can prove it is on the brink of financial collapse – so the threshold is high.
If you are considering any of the options mentioned, it is best to call the NFU Employment Service team and discuss the best way forward for your business now before the new changes come into effect.
Feel you need some extra help handling employment law? Our comprehensive service could be for you. With a host of support available, including an unlimited-use helpline, we provide you with the practical support and legal guidance to enable your business to become and remain compliant with legislation.
For more information on the benefits of becoming a NFU Employment Service member please contact us on 0370 840 0234 or email us at [email protected].
