With the state of the current economy many businesses are needing to find ways to reduce their overheads as the recession takes hold. For some employers, this means redundancies and for others, adopting alternative ways to make the necessary cost savings whilst trying to maintain their existing staff in whom they have invested time and resources. You should however turn to layoffs only after you’ve tried just about everything else. So before you sign the first of those pay slips, and think about these alternatives, which includes -
Considering reaching an agreement with staff to reduce their salary or benefits. It is essential that staff agree to any such changes or you will be vulnerable to claims for breach of contract or unlawful deduction from wages.However, sometimes (not all the time, only some), it’s your customers that are costing you too much. The solution: Get rid of them and stick to the customers who make you money. For example, American Express sent select customers 300 pounds if they agreed to pay down and close their accounts. In addition, Amex flat-out closed 2.7 million accounts because they had zero balances or had been inactive for two years.
Also review your employee benefits. It may be that by shopping around or engaging the services of a broker you can find alternative providers for your employee benefits, such as medical insurance and life assurance, which will save you costs. Some employees, particularly those with caring commitments, may also be happy to take up part-time working or reduced-hours flexible working that will cut your wage bill. Such flexible working may include late starts and early ends to the day, term-time working or job sharing.