... but HR consultant Melanie Darlington says 'slashing the workforce' is not the only way of handling the Covid-19 employment crisis.
The pandemic has impacted all UK businesses and their employees. With the economy shrinking, unfortunately, many believe redundancies are the only way out. As a result, 695,000 fewer people were employed in August compared to March this year and UK unemployment reached 4.1%.
Chancellor Rishi Sunak said "helping people get back into, or finding new work" was his "number one priority", but in a briefing to the Cabinet on the economy, he reaffirmed the decision to end the government's Job Retention Scheme on October 31st.
In the wake of COVID-19, twice as many private sector employers are expected to make redundancies compared to the public sector. While some cuts might be necessary, it's essential not to lose sight of the alternative possibilities before shedding headcount.
Double-check your T’s & C’s: Increasing remote workers can correspond with temporary or permanent pay reductions, should this help to reduce business costs and subsequently preserve future jobs. Employees facing cutbacks will be better able to handle the situation if they’re saving on commuting costs, confirmed by the London commuters who are predicted to save up to £15,000 if COVID-19 work trends continue.
Reducing working hours is another option, however, businesses will need to review employment clauses to see if its current terms and conditions permit this. Several clients have agreed on changes to hours and therefore pay either on a temporary or permanent basis to reduce costs. Many employees have accepted the change as it provides them with a better work-life balance. The ability to acknowledge a mutual benefit can garner back some control during this period of uncertainty, and allow employees to pick up stress-reducing habits as they claw back time to exercise, relax and slow-down.
Assess the current workforce: While many successful companies take steps to increase frontline efficiency with lean management techniques, a similar opportunity resides in understanding incoming work and optimising labour accordingly. This could mean a change in hours, a change in terms of the role and what someone is expected to do. Taking the time to recognise and acknowledge employees is also essential as this will keep staff motivated. Employers may also consider reviewing transferable skills to support an internal role change, or to help employees with future employment should a redundancy be unavoidable.
Push the gap year for adults: Research has shown that time-off is good for business and its staff, as sabbaticals tend to boost success rates and well-being. Mental health in the UK is expected to nosedive as COVID-19 infections rise and restrictions are imposed, so providing employees with the option to take a much-needed break may benefit the workforce and the business. Adjusting to a smaller number of workers will also future-proof the company when it has to deal with unexpected absences or redundancies.
Look outside of your in-house team: Businesses can consider pay and recruitment freezes, which will provide some stability and slash the costs of on-boarding new starters. Also, businesses can remove or reduce the use of temporary and/or agency labour, staff overtime, bonuses or pension payments. Freezing training budgets is another option, as many learning platforms are picking up the tab with free courses during the crisis. The UK government, for example, has hosted a new platform ‘The Skills Toolkit’ which offers free digital courses.
Now is an ideal time to determine and plan your workforce to ensure that you have the right mix and numbers of staff, with the core skills and knowledge, to meet demand, now and in the future. Transparent communications with staff will be critical during this process, even where collective consultation (under s188 Trade Union and Labour Relations (Consolidation) Act 1992 (TULR(C)A) is not a legal requirement.
Melanie Darlington is the Senior HR Consultant at Alcumus.