United Kingdom: Restructuring your team? Here's how

With inflation on the rise and budgets being squeezed, it is no secret that companies are having to review the efficiency of the organisation and make savvy decisions in order to survive and thrive. Managing resources such as employees becomes a delicate balance in such situations. Companies should take great care in exploring the following options in order to achieve their short term as well as long term goals:

Retraining (upskilling) employees

This is often an overlooked option. The cost of replacing staff is astronomical and retaining existing talent to fill any gaps in the organisation would increase employee engagement, boost morale, develop deeper commitment and increase productivity. In short, it sends the right message to the employees and maintains the company’s reputation. 

Offering pay cuts

According to a recent study, 74% of employees say that they would take a pay cut for a new job with a thriving culture that is ideal for growth. This suggests that, as long as your company keeps morale high and has a realistic long term growth plan, employees may be willing to stay on at a lower salary. 

Reduction in workforce

This decision should never be taken lightly. However, it is sometimes the inevitable outcome. In such cases, employers should be aware of the following legal requirements that must be be observed in order to avoid financial and reputational penalties: 

  • Warn staff of potential redundancies before a final decision has been made

  • Consult with them, including on the selection process and on ways in which the redundancy can be avoided

  • Carry out a fair selection process using objective selection criteria, and make sure you have properly considered the appropriate pool of employees to select from

  • Consider suitable alternative employment within the company or the group

  • Allow employees their right to be accompanied at consultation meetings

  • Give notice of termination in accordance with the contract

  • Offer a right of appeal

Pro tip: Remember to also consider voluntary redundancies as a way to avoid compulsory redundancies and don’t forget that special consultation requirements apply where 20 or more staff are being terminated within 90 days

To find out more about how to deal with your reduction in workforce, speak to one of our friendly experts!