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10.06.2020

Five alternatives to making redundancies

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It’s no secret that COVID-19 has caused significant issues for businesses throughout the island of Ireland.

As a result, redundancies have become a possibility for many employers as a means of securing their business futures. If you’re considering redundancies within your business, there are some alternative options to think about before making any changes.

Reduced working hours

Businesses have seen a decrease in demand due to the impact of COVID-19. As a result, staff may now be able to work fewer hours. However, it’s important that you don’t unilaterally change a fundamental term in a contract of employment when enacting such a change.

It’s important that you’re transparent with staff about the needs of the business when work resumes. If possible, confirm their agreement to any changes to their employment contract before putting them into effect. While some staff members may not be too enthusiastic at the prospect of reduced hours, it remains a better option than redundancy.

Putting a pause on training provisions

You might be an employer who spends large amounts on training. If so, pausing such provisions is another way to save on expenses.

Opportunities for development are much sought after by staff looking to add value to their roles. So, if you pause training provisions in your workplace, remind staff that it’s only until the business is in a healthier situation. You should also take care of staff engaged as part of a training contract. Removing the training element of their role could lead to a breach of contract claim.

Putting a hold on bonuses

Many businesses offer annual bonuses as a way of rewarding staff and keeping morale high. In the current climate, suspending bonus payments could provide some respite for your business. However, if bonuses are a contractual entitlement, withholding them could again be a breach of contract.

That said, if there is a discretionary clause in the contract outlining that bonuses will only be made if business needs permit it, employers could seek to rely on this discretion. It should also be remembered that if bonuses have been paid consistently over a number of years and employees hit their targets, they could be entitled to receive their bonus based on custom and practice which could supersede the employer’s discretion not to award a bonus.

Utilising flexible working arrangements

Some employers may see redundancy as a way of reducing the number of onsite staff and assisting in adhering to social distancing measures. However, flexible working offers an alternative to this. For example, staff could work from home on a more permanent basis. Or, shifts could be staggered to reduce numbers in the building at any one time.

Voluntary redundancy

For employers who wish to proceed with a redundancy procedure, they will need to ensure that the correct process is followed. One key aspect of this is demonstrating that alternatives to compulsory redundancies have been considered, which can include offering voluntary redundancy to staff. This invites staff to put themselves forward for redundancy and therefore help employees who do not wish to be made redundant avoid this.

Ultimately, it’s down to you, the employer, to decide who is to be made redundant.

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