CIPD

With the Government’s Furlough scheme ending this month, fear about large-scale job losses loom large. A third (33%) of employers intended to make redundancies over the last financial quarter, and our August survey of employees found that one-fifth (19%) thought it was likely they would lose their job in the next 12 months. The majority told us they’d find it difficult to get another job. 

Significant uncertainty around the economic climate remains, and the true scale of redundancies is unknown. It’s also unclear how far the Government’s new Job Support Scheme and other employment initiatives will help to offset job losses in the UK. However, it’s clear that many employers are already making difficult decisions about redundancy, and many employees are dealing with the devastating blow of losing their job.  

Being made redundant at any time is hard enough, but it is even more challenging in the context of a global pandemic, when many people’s mental health is already at a low. There will also be heightened worry about securing alternative employment at a time of rising unemployment and recession.  

Compliance is a must… 

Employers must abide by a considerable amount of employment law when planning redundancies. These legal obligations set a minimum standard of how to treat people during the process. However, worryingly one in four (24%) bosses were unaware of the law around consulting staff before making redundancies, according to recent Acas research.  

Where a business needs to cut back, redundancy should always be a last resort. Employers have a duty to look for and offer suitable alternative employment if it’s available in the organisation, to help avoid compulsory redundancies. A joint statement released recently by Acas, CBI and TUC urges employers to go further and ‘exhaust all possible alternatives’ before making redundancies. This is also fully endorsed by the CIPD. 

Encouragingly, our latest research Labour Market Outlook survey found evidence that employers are exploring various options to minimise redundancies, including: 

• recruitment freezes (42%)  
• introducing new or more flexible working arrangements (38%) 
• cuts to training budgets (23%) 
• temporary layoffs through the Job Retention Scheme (54%)  
• terminating agency or temporary worker contracts (32%). 

…but so is compassion 

However, some employers will have no choice but to make the tough decision to reduce their headcount. No organisation takes this step lightly, and typically HR professionals will approach their role in implementing redundancies with reluctance and a strong sense of responsibility for those affected. However, the best intentions can get lost across the wider organisation if key stakeholders aren’t supported or guided, and there can also be a temptation to get a challenging process over with as quickly as possible.  

At the outset, it’s important to plan the redundancy process in a way that embeds concern for people’s wellbeing at its core. This should include guidance for managers, so they can act with compassion when dealing with the concerns of both people in the redundancy pool, but also wider team members. A redundancy situation can quickly cause negative ripples across an entire organisation if it isn’t handled in a humane way that upholds the dignity and respect of those concerned. 

Compassion means having empathy, putting yourself in another person’s shoes by understanding how they feel and treating them in a humane way. But it also means being prepared to act on their situation to improve it. In a redundancy process, that doesn’t necessarily mean not making redundancies – but it could involve taking a number of steps to improve how the process is carried out, which ultimately can affect how someone might react or cope with it. 

Key tips for building compassion into the redundancy process 

• Communicate regularly and be clear, sincere and transparent: 
  think carefully about both the tone and content of what the organisation is communicating, because how the news is broken to people will have a big impact on their response. People appreciate honesty, and it’s important to prevent the rumour mill filling any vacuum in communication. Make sure any communication is two-way, and emphaise that any decision is not a reflection of that person’s performance.  
• Train and support line managers to have empathetic conversations: 
  managers are likely to be the first port of call for people, and redundancy will be one of the most difficult tasks they will deal with. Ensure the organisation supports managers, both practically and with their wellbeing so that they’re equipped to deal effectively with this responsibility. Many will be handling these conversations and meetings remotely, and so they will need the space, time and training to do so effectively. 
• Provide ongoing health and wellbeing support: 
  being selected for redundancy can have a significant detrimental impact on someone’s mental health. Immediate and ongoing support should be available to the individual to safeguard their wellbeing. This could include access to occupational health, financial advice, and an employee assistance programme (EAP). Some EAPs will carry on the support for redundant employees up to three months after they left the organisation. 
• Be mindful of the wider workforce: 
  Redundancy can have a significant impact on other employees and their morale. It’s an unsettling experience seeing colleagues laid off, and some will worry that their own job security is at risk. How the organisation treated people during redundancy will be remembered and is a huge test for employment relations. The organisation needs to present a clear vision for the future and work to restore the confidence needed to move forward. 

Redundancy is a daunting process, and cannot be underestimated. But it’s possible to do it well, so that people leave knowing they have been treated fairly, with respect, and that they have been supported through the process. Treating people in a humane way throughout will also help the organisation and the remaining workforce to move forward. 

Find relevant resources below: 

CIPD Coronavirus (COVID-19): Redundancy guide 

CIPD factsheet: Redundancy: an introduction 

CIPD resources on redundancy 

Acas resources on redundancy