With one in ten people in the West Midlands signing on, it is clear that the recession is far from over and that businesses have a long way to go before the golden days of the last decade make a return.
The West Midlands has recently been rated as having the fifth highest unemployment rates within the UK; an obviously worrying statistic. It is therefore vital that at such times employers remain aware of any potential risks they may face, how to avoid them and also save costs by considering alternatives to reducing staff numbers. We have prepared a list of top tips to help:
If a need arises to make redundancies
- Ensure that you follow the correct process to avoid claims being brought against you. In particular:
- Be careful when determining your pool for redundancies
- Ensure selection criteria are as objective as possible or at least provide for objective marking of any subjective criteria.
- Consult with your employees with regard to alternatives to redundancy.
If you need to consider reducing your workforce
Be mindful of potential issues surrounding particular groups of employees (i.e. those on maternity leave, those with disabilities or those who are at or approaching retirement age). Remember: any retirement dismissals which follow the current process and that take place on or after 6 April 2011 will be unfair.
If you are considering dismissing employees
With less than one year of service - BEWARE! These employees still have rights and can make claims to the Tribunal such as discrimination, whistleblowing and breach of contract. If unsure, you may wish to investigate further to rule out such claims or at least minimise your risk.
Deal with grievances fully.
A grievance need not be in writing or if it is, the employee may not refer to a ‘grievance’ and so look at each case carefully in turn. Investigate fully and take action wherever necessary.
Ensure that any self-employed workers are truly self-employed.
Workers who are classed as ‘self-employed’ may actually be employees or deem themselves to be employees if they find their services are no longer required by a business. If unsure, consider getting your consultancy/contractors’ agreements reviewed.
Consider employee incentives.
Effective employee incentives can play a key role in recruiting, retaining, motivating and rewarding employees while offering significant tax savings (when compared to cash bonuses). If you need to motivate your employees cost efficiently, Wright Hassall's specialist employee benefits and incentives team can assist with all aspects of incentive design and implementation. For further details please contact
John Dormer.
Consider salary exchange schemes.
Exchanging taxable salary for a tax efficient allowance or benefit (e.g. a subsistence allowance for a mobile employee or an employer pension contribution) is a tried and tested way of saving employers money whilst at the same time enhancing employee's benefits or net take home pay. For further details please contact Alan Darby or Rajan Savjani.
For further advice, please contact Sarah Stratton on 01926 884684.
