Redundancies should be 'last resort'
Nov 13 2008
Redundancies should be a last resort as they cost companies on average £10,000 each time and lead to a loss of credibility.
The Chartered Institute of Personnel and Development (CIPD) advises business to use tactics like recruitment and pay freezes rather than making redundancies.
Gerwin Davies, public policy adviser at the organisation, says downsizing costs an average of £10,000 and also leads to money being spend on recruitment when the economic situation improves.
'We are doing our best to ensure redundancies remain our last resort and they [businesses] use other measures such as cutting hours, pay freezes or recruitment freezes rather than making redundancies,' Davies states.
The expert also adds that businesses should be congratulated for reducing job losses so far, saying many firms have lasted a year since the credit crunch began.
Figures from the CIPD's Labour Market Outlook found over a quarter of firms are planning to make people redundant in the next three months.
Davies states companies should think about the loss of creditability as a cost when starting redundancies.
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