COVID-19 and redundancy – what employers need to know

As the government’s Job Retention Scheme moves ahead, more organisations are more likely to understand if they can evolve to remain competitive or whether redundancies must be made.

Chris Parker, Managing Director of Renovo, the UK’s leading specialist provider of outplacement support, said: “The sad reality is that because of the impacts of COVID-19, companies that were thriving just a few weeks ago are now considering redundancies. Normally, redundancies happen in practically every sector despite a business’ best efforts, but now, even the best-intentioned leaders across the UK are left with no choice”.

According to Renovo, there are 8 issues every company should consider if redundancies are unfortunately needed:

1. Thinking ahead is crucial

You can never underestimate the importance of planning as you approach redundancy. Whether it’s developing clear and realistic timelines for the Consultation process, engaging Employee Representatives early, or planning for support that you’re putting in place for employees, thinking ahead, even in these times, is crucial.

2. Making people redundant is expensive

Costs include losing the skills and knowledge of departing people and hiring in and training new people. Businesses must ensure that employees can adapt to the organisation during periods of transformation. Redeployment may help save money, assist with retaining key talent, maintain morale, while also supporting productivity.

3. Communicate, in the right way, to everyone

It is not only those employees who you must let go who suffer, but also those who remain. Employers need to ensure that both parties receive the support and communications they need. Employees that remain may be worried about whether there are more upcoming redundancies and might consider leaving on their own terms. To retain the employees you have left, ensuring they remain focused on their work, communicate clearly why redundancies are necessary. Ensure they can trust you when you tell them that they are safe in their positions within the company.

4. The confidence issue

Redundancies are not personal, but that doesn’t mean that employees won’t take it that way. The redundancy process can be enough to rock an employee to their foundations, robbing them of their confidence and preventing them from moving on with their lives. However, redundancy can actually be an opportunity for them to take a positive step forward in their careers. It’s important to help them see the opportunities.

5. Dealing with fallouts

Different employees will react to the news of redundancy in different ways, and you could face anger, confusion, distress and sadness, amongst other emotions. Those individuals not selected for redundancy will likely go through a range of these emotions too, as well as ‘survivor guilt’ and uncertainty about their future role in the business. If not managed correctly, these emotions can unsettle a business and may result in the strongest individuals not selected for redundancy handing in their notice. Providing emotional and professional support throughout the entire process can help avoid these reactions.

6. The employer brand needs protection

Platforms such as Glassdoor and the prolific rise of social media mean that it is very easy for an organisation’s reputation to be damaged if they mismanage the change process. While redundancies are never easy to manage, providing valuable outplacement and redeployment support to departing employees decreases the risk of reputational damage significantly.

7. The people that manage the redundancy process need support too

Whilst most people are aware that making redundancies or restructuring a team can place a great strain on individuals let go as well as those who remain behind, often the strain on the HR teams or managers organising the process is forgotten. It’s understandably difficult, especially if details of personal lives, family commitments or financial needs are known. By pulling together as a team and communicating needs and challenges, it may be possible to share workload and ask for help when it’s needed.

8. Raising morale is essential, at a time when it’s really difficult to do

Your team’s energy may visibly reduce, which is understandable as many may have lost friends or close colleagues, or fear for the security of their own positions within the company. While they may all still be working diligently, it is likely that their enthusiasm may diminish. It’s key to redevelop a positive morale within the workplace to increase productivity, staff engagement, decrease employee turnover and ultimately achieve a happier workforce.

Renovo’s Parker concluded:

“Making redundancies will always be difficult, but if done carefully taking into consideration the points made, the process can be carried out much easier and more effectively, significantly reducing the emotional fallout that is, to a certain degree, inevitable. Using a third-party agency for outplacement support to help employees better navigate the job market and transition into new roles will also help to decrease the impact of the news.

“By extending emotional support to remaining staff and being on hand to answer questions about how roles and workloads will change, the morale of those left behind is likely to remain much higher. This will help to build trust in your organisation and can significantly decrease absenteeism following the news.”