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How to Manage Redundancies

Date: 13 Jan 2011

Imminent pay freezes and job cuts in the public sector will focus activity on efficiency savings, transformation and restructuring that will be unprecedented in modern times. This is likely to last well into 2015, and such is the crisis in public sector finances that no area will escape the personal and professional challenges that such a crisis brings. Moreover the HR skills required for driving change will come at a premium when budgets are under pressure.

This activity is also likely to take place with the added pressure of industrial action and a private sector that is still in recovery and potentially not ready to take up the excess talent coming out of the public institutions.

It is likely that the current, often highly generous, terms surrounding public sector redundancies will be reformed. Whilst some individuals may opt to take advantage of current voluntary redundancy schemes, it is unlikely that the cost savings made through this route will be sufficient to reach the overall savings that public sector organisations have been charged with making. As such, mandatory redundancies will be necessary – often on less favourable redundancy terms. Employers will need robust processes, knowledgeable staff and a high degree of sensitivity when embarking on any project that incorporates potential future redundancies.

Common practice in the public sector obliges any institution wishing to make staff surplus to requirements, look to redeploy those whose jobs have been declared redundant. This protocol will undoubtedly be revised when such bodies will be faced with large numbers of staff and there will be inevitable debate on whether the redundancy scheme is contractual.

This threat of job loss and the uncertainty about budgets and programmes will mean that morale and engagement will also be at a low point. Now more than ever, organisations in the public sector will have to respond quickly to external pressures, often outside of their control, in order to progress and, more importantly, survive this unprecedented climate.

We have put together a general best practice guide to managing a reduction in the workforce, the general principles of which can be applied to all sectors. For any change project to be successful, organisations need to prioritise the leadership and support of the people who will make it a success. This should include those who may not be staying with the organisation.

Keywords: HR |