News Article


Considering Redundancies? Let’s Discuss Your Options

This month I wanted to talk about redundancies. It’s a subject all employers dread for the harsh reality is that no-one wants to embark on this journey. However, if you find yourself considering this option, then NOW is the right time to get some expert advice on managing the process with careful consideration and compassion.

With the gradual phasing out of the furlough scheme, it means business owners are going to have to make some difficult decisions. With the sole financial responsibilities on your shoulders again, for many, it may not be possible to return to ‘business as usual’.

Phasing Out Furlough

The furlough scheme has been a lifeline for many UK businesses. Supporting over 8.9m employees, it has enabled employers to retain staff during the lockdown while giving them the breathing space to pivot, prepare and re-assess their future. However, the furlough scheme is not a long-term strategy for the government; it is wholly unsustainable, and with that, the government have announced plans for a gradual reduction in support. As lockdown eases, employers can start to re-open their businesses and employees can return to work in a safe and socially distanced manner.

The lockdown was the first time the government has ever instructed businesses to close their doors and remain closed indefinitely. Left reeling, business owners scrambled to access the loan schemes, grants and funding available. However, some fell through the cracks, or it simply wasn’t enough, and they shut their doors permanently.

In mid-June, the Financial Times reported a dramatic increase in people claiming out of work benefits with numbers reaching 2.8m at the end of May. This was an increase of nearly 1m from April! Not surprisingly, there has also been the largest drop in job vacancies since records began.

The official unemployment figures have remained relatively unchanged because all furloughed workers are still considered employed, but that’s likely to change significantly. The stark reality is that these numbers are expected to increase rapidly as the job retention scheme is phased out.


So, what are your options?

Before embarking on any significant decisions, it’s prudent to get the right advice. Your accountant will help you to gain clarity on your actual financial position and advise you on where you may need to reduce costs and increase revenue.

Likewise, an experienced HR specialist will help you to gain clarity on your rights and responsibilities while guiding you through some of the alternative options before deciding on redundancies.

So, I hear your objections: “It’s going to cost me more money to hire an external HR consultant!”

Yes, it may be an additional expense, but it’s one that gives a return on investment quickly. It’s also your insurance net!

I’ll explain what I mean in more detail below after we’ve talked tactics.

  1. Flexible furlough or reduced working hours: From 1st July you will be able to bring some employees back to work part-time while they remain on furlough. You’ll be required to pay the usual rate of pay for employee hours worked, but you can then continue to access the govt funding for the remaining furlough hours.

    This is a good option during the re-opening on business from July to October but be mindful of the reduced govt contributions of the furlough scheme at the end of September and October.
  2. Pay-reductions for the foreseeable future: This means more employees can keep their jobs and you can keep your business running and return to optimum capacity asap. Not ideal, but it will buy you some time to get back on your feet, and it will help your employees to stay away from the unemployment line.
  3. Job-share: This is a great option, especially over the summer period with children unable to return to school until September and parents struggling with childcare options. Perhaps ask your people who would prefer this option – you may be surprised at the number of raised hands.

Good News!

While I am afraid there are likely to be some very tough times ahead, the good news is that you don’t have to face them alone. Earlier I promised I’d explain how working with an HR specialist will realise a quick return on investment and be your safety net!

By working with us, you’ll get the right guidance at the right time. We’ve helped business owners just like you to:

  • Overcome difficult periods of change and transition with the best possible outcomes.
  • Mitigate the risks of legal action from unhappy employees
  • Negotiate new terms and conditions with employees to keep the business afloat
  • Prevent redundancies by adopting alternative strategies
  • Navigate the process of selecting, negotiating and managing the redundancy process

We will save you time, money and potential legal problems.

Your Safety Net.

We offer employers like you, a safety net. One which we can honestly say has proven it’s worth time and again for our clients. Hopefully, with our help, you can work this out smoothly and happily with your employees; however, if it doesn’t work out that way, you’ll be protected.

We offer an insured service that pays out if you follow our advice. It provides you with the protection your business needs against costly legal fees; covering all forms of employment disputes when you need it the most. It gives you the peace of mind that our policy will pay the legal costs to represent you and any settlement, compensation or damages awards against you arising from a dispute with a worker. Your cover will be valid as long as the advice is sought and followed from one of the SFB Consulting team in association with the legal team at Tees Law. We work in partnership with Tees Laws and Albion Legal to provide our clients with this cover (as underwritten by Albion Legal).

Simply follow our expert advice, and you’ll be confident in dealing with difficult employee situations.