Compulsory redundancy preferred method of downsizing

More
than two out of three employers have cut their workforce over the past two
years, according to research by the IRS Employment Review.

The
study shows that a similar proportion of employers in the survey predict they
will downsize in the next 12 months.

The
survey shows nearly 90 per cent of companies use compulsory redundancies as
their preferred method of downsizing, although voluntary redundancies and
natural wastage are also widely used.

Nearly
nine out of 10 surveyed organisations select employees for redundancy by the
level of skill and competence shown by individual workers – and they rely
heavily on line managers for that information.

Nearly
60 per cent of employees take account of staff attendance records when
selecting for redundancies, 55 per cent consider disciplinary records and a
similar proportion use past performance.

Most
employers offer more than the statutory minimum redundancy payment, which for
most people would otherwise be just a week or a week and a half’s salary for
each year worked.

Outplacement
and counselling services are also becoming more common.

The
research, which included responses from 60 large organisations, shows employers
that recognise trades unions are less likely to have cut their workforce during
the past two years than those that do not. 

IRS
Employment Review managing editor Mark Crail said: “For those employers who do
have to consider shedding staff, we offer a warning to remember and manage
those left behind – the redundancy survivors.

"Other
lessons learned from the last recession show that shedding staff too quickly
can leave skills shortages when the economy picks up; an alternative may be for
staff to take time away from work such as returning to study. Increasing
efficiencies and cutting overheads does not have to be at the cost of skilled
employees.”

By Ben Willmott

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