Challenges for Employers
in an Age of Brexit Uncertainty
With the chance of a ‘no-deal’ Brexit being reported as increasingly
likely, the ongoing uncertainty has inevitably impacted on the
economy, with the Bank of England metaphorically suggesting that
“the slightest sign of rough weather” in the economy could cause
“significant” problems. Consequently, businesses are having to make
contingency plans to ensure the sustainability of their business.
So what are the options for employers in the
face of these uncertainties? How can they
best manage their resources and ensure
they have the right workforce in place?
Redundancy
For those facing business closure or a
reduced need for employees, redundancies
may be the best option. However, it is not
without cost or risk. Employees must be
consulted before any final decisions are
made, the changes impact on productivity,
there is a permanent loss of skills and
expertise, and employees with more
than two years’ service must be paid
statutory redundancy pay in addition
to their contractual entitlements. The
dismissals could also result in claims.
Short time working or lay-offs
Those facing an unexpected or temporary
downturn in their business could consider
short time working (i.e. reduced hours or pay),
or lay-offs. Although these options reduce
costs whilst retaining skills, they should only
be used where there is a contractual right,
or it is industry practice (as the car industry)
to do so. Arbitrarily imposing these terms
on staff could lead to claims for breach of
contract or constructive unfair dismissal.
Using contractors/workers
(the so-called ‘gig’ economy)
Businesses looking for a flexible workforce
are increasingly using workers or contractors.
The nature and terms of the contract will
depend upon what is agreed, with the
genuinely self-employed having few, if any,
employment law rights. The downside of
this type of working is that the worker does
not ‘buy in’ to the company brand and the
skills are lost at the end of the contract.
Zero hours/temporary/agency staff
This option provides flexibility although, as
employees, these individuals would receive
employment law protections. Equally, after 12
weeks, an agency worker would be entitled
to the same terms and conditions as a
permanent member of staff. This option
may be useful to meet unexpected peaks
in demand.
Settlement agreements
These are commonly used on termination
of employment to settle any claims the
employee may have against the employer.
Employees must obtain independent legal
advice on the terms of the agreement but, if
properly used, they are a quick and effective
tool for ending the employment relationship.
If you have any questions about the
above, or about managing your HR and
employment relationships in general,
please do not hesitate to contact
Employment Lawyer, Debbie Sadler, at
[email protected] or on 01494 478671
blasermills.co.uk
| 39
hiyabucks.com