By Daniel Pollard - 20 October 2020
UK employers consulted with staff on nearly half a million redundancies during the pandemic - roughly 1.5% of the working population. The true number will have been much higher as small-scale redundancies are not captured by government statistics. The furlough scheme will have given many employers an opportunity to pause but as the scheme comes to an end, employers face some tough choices.
Over recent months we have seen a huge amount of creativity from our clients in finding ways to minimise redundancies. We share 12 possible strategies adopted by our clients and some thoughts of our own to help reduce cost without compulsory lay-offs.
2. Cut Pay
A large proportion of our client base have implemented pay cuts in one form or another. In the case of employees placed on furlough, many were asked to agree to a 20% reduction in pay and so 20% has been typical of the reductions in pay that we have seen.
However, with employees working at home and with reduced commuting costs there is scope for almost all employees to accept some reduction without any change in their “take home” pay.
The key issues to consider are:
For all 12 ways to cut HR costs without redundancies click here.