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Businesses at legal risk

Dec 14 2009

Cost-cutting measures to reduce staff overheads have increased the risk of companies being drawn into litigation, warns accountancy firm BDO.

Half of UK companies have sought to reduce their costs by increasing their use of subcontractors and freelancers, by outsourcing activities such as support services or relocating facilities, according to a survey by BDO.

Gervase MacGregor, national head of advisory at BDO, warns that while cost savings can be made by changing staff contracts, companies should seek professional advice to ensure they are legally protected.  

However, of the 201 CEOs and FDs surveyed, 75 per cent say they did not realise that cost cutting exercises such as outsourcing have actually increased their risk of being drawn into litigation

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