Alternatives to redundancy

Letting good people go should always be a last resort.

Human Resources


Emma Wood, a personal consultant at NorthgateArinso Employer Services, considers measures companies can take before filling out the P45s.

Temporary options

•    Stopping overtime
Most employees when paid overtime are paid at an advanced rate. Look at employing basic rate employees to cover this overtime.

•    Reducing hours
Talk to your employees about temporarily reducing their hours to a four or three-day week. Also, look at shift patterns – can these be reduced or alternated? You may also want to negotiate a temporary change in rate of pay.

•    Re-training
Look at widening the skills of your staff so they can be redeployed into different departments within the business.

•    Sabbaticals

Many members of staff may be looking to take time off to travel the world or even spend time at home with families. Sabbaticals are a great option to consider as they are always unpaid.

•    Layoffs
These are often used as a short-term alternative to redundancy. This allows you to send people home on limited pay or unpaid for a specific amount of time.

Permanent options

•    Natural wastage
During difficult times some of your employees may wish to resign. Also, if you have employees currently going through dismissal processes, make sure you keep on top of these.

•    Early retirement

Some of your staff may wish to take early retirement.

•    End all temporary contracts

Although these have a fixed termination date, you do have the flexibility to end them sooner.

•    Introduce specific purpose contracts

If you are employing new staff for a defined period, there is no need to give them full-term contracts.

•    Compromise agreements
These are useful if you have no other alternatives. You will need to remember that the employee will need to seek advice to ensure this is a correct legal document. You should seek legal advice as well.

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