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What options can employers consider as an alternative to redundancy?

View profile for Gillian Markland
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What options can employers consider as an alternative to redundancy?

Redundancies normally occur as a result of a business needing to cut costs or restructure existing roles. However, before deciding whether or not to dismiss an employee on the grounds of redundancy, there are other ways that a business could reduce its costs whilst retaining the skill sets of valuable employees.  These include:

  • Reduce working hours
  • Introduce flexible working arrangements
  • Job share
  • Reduce salaries
  • Sabbatical (paid or unpaid)
  • Recruitment freeze
  • Remove overtime
  • Cut bonuses
  • Lay-off

By exploring alternatives, the business avoids the motivational and reputational damage that a redundancy process can bring with it. Additionally, redundancy costs should not be underestimated and can, in reality, be greater than the financial impact of alternative measures.

Clearly some of the options outlined above are unlikely to be particularly welcome but it is important to bear in mind that employees are often more likely to agree to proposed changes if the alternative is redundancy.

Ultimately, changing terms of employment needs to be done correctly otherwise you risk exposing your business to claims and costs which could ultimately defeat the purpose of making the changes in the first place. It is therefore advisable to plan and receive proper legal advice before making changes to your employees’ terms of employment. Also bear in mind, the list of alternatives outlined above is by no means exhaustive and there may well be other possibilities, depending on the particular circumstances facing the business.  

Please get in touch with our specialist employment team if you have any questions about anything discussed in this article or around employment law generally.

Our articles are intended for general information purposes only and are not a substitute for professional advice tailored to your specific circumstances. We are always very happy to discuss any plans, issues or concerns you may have and to clarify how we might be able to help. We cannot accept responsibility for any loss as a result of acts or omissions taken in respect of this article.