Cutting costs, not heads: the legal view on alternatives to redundancy

The lessons of previous recessions have not escaped today’s employers, many of whom are determined to avoid compulsory redundancies this time around. They recognise that making staff redundant requires investment in HR and management time, while also incurring significant direct and indirect costs, estimated by the CIPD at more than £16,000 per employee.

There is also the risk of redundancies triggering tribunal claims and damaging relations with remaining staff. The likely need to replace redundant workers once the economy recovers is another reason why the idea of cutting staffing costs, rather than heads, seems to hold such appeal for employers.