EMPLOYERS are being urged to consider alternatives to making people redundant as Covid furlough ends this week.

Furlough – the Coronavirus Job Retention Scheme – ends on Thursday and it has been estimated that up to a million people could be left unemployed.

The travel and hospitality industries are expected to be especially hard hit. A recent survey of 107 members of the travel industry body ABTA found the majority with staff on furlough would be making redundancies.

Charlotte Farrell, associate solicitor in the employment team at Southampton-based Paris Smith urged employers to follow the proper processes to avoid the risk of claims for unfair dismissal or discrimination.

“While redundancies will be unavoidable for some employers, for others there may be alternative options they could explore to avoid redundancies or minimise the number they need to make,” she said.

She said the main alternatives to consider were:  

  • A reduction in pay but with the same hours. Ten members of staff could agree to a 10 per cent pay cut instead of making one role redundant, she said.
  • A reduction in hours with an associated reduction in pay. Five full-time employees could take a 20 per cent pay cut each and work four days instead of five, to avoid one redundancy.
  • Job share, with two full-time staff agreeing to share one post rather than one being laid off.
  • Sabbaticals or career breaks. She said these were rare in the private sector but an employer could relax the rules.
  • Re-training so that good staff could be redeployed.

“It’s really important that any changes are handled properly and the correct process followed, as they would be a change to an employee’s contract of employment and cannot be imposed unilaterally,” she said.

“Where an employer has no option but to make redundancies, they may want to consider offering voluntary redundancy and a settlement agreement to those affected instead of going through a formal redundancy process.

“This won’t be suitable in all situations but it could be useful if the process will be particularly stressful for those involved or the employer wants to make enhanced redundancy payments,” she added.

“Whilst some sectors are facing a reduction in work and having to make these difficult decisions, other industries have seen an increase in vacancies and are struggling to recruit. Employers going through a redundancy process over the coming weeks may also want to consider signposting affected employees to outplacement services to provide additional assistance in finding a new role for the future.”