We have most answers to the questions on whether a company would be eligible for the job retention scheme and it will not always be an appropriate solution. So here are a few alternatives to help you get through the next period without reducing headcount.
Annual leave – Employers could explore the option of asking if employees would take some annual leave over the next few months in the hope that when we return to some form of normality employees are available to work.
Career breaks – We recognise staff are struggling to work a full day with young children at home and are quite stressed, often due to their strong work ethic balanced with the need to care for their children or other dependents. A career break or sabbatical is perhaps an attractive option. It can take the stress off the employee if they can afford to take a break and reduce costs for the Company. This would need to be voluntary and the employee may still be eligible for benefits including paid annual leave.
Layoffs and short-term working – Employers can impose a lay-off or short-term working arrangement only if there is an express or implied contractual right to do so. Otherwise, this is a matter of negotiation between the parties. If you do decide to lay off an employee for more than four weeks where there is no contractual provision, they have a right to claim redundancy payments after the fourth week.
In this instance, an employee will be eligible for a redundancy payment if they give notice in writing to the employer indicating their intention to claim a redundancy payment within four weeks of being laid off or kept on short-time working for:
- four or more consecutive weeks; or
- a series of six or more weeks (of which not more than three were consecutive) within a period of 13 weeks (s.148 of the Employment Rights Act 1996).
- reducing or stopping the use of temporary, agency or casual staff;
- redeploying employees to another role, which may be in a different department;
- retraining employees so that they are able to carry out other roles within the Company;
- secondments to a client;
- implementing a pay freeze so employees will not receive a pay rise following the annual pay review;
- reducing or stopping bonus payments;
- implementing a pay cut; and
- implementing, or seeking volunteers for, a reduction in working hours or part-time or flexible working arrangements, with a commensurate reduction in pay and benefits.
Redundancy – Finally we can’t miss out the obvious one but we were trying to be creative. An employee is dismissed by reason of redundancy if the circumstances of their dismissal fall within the definition of redundancy as set out in s.139 of the Employment Rights Act 1996. A fair procedure must be followed and will involve a period of consultation with the employees. If an employer is looking to dismiss 20 employees or more within a 90 day period or less, then you will need to carry out a “collective consultation”.
For fewer than 20 employees, there is no fixed time period for a consultation but it must be long enough that the consultation was meaningful, alternatives explored and all questions answered and suggestions considered.
27th March 2020 – TRobb@triviumlc.co.uk