Monday, January 05, 2009

“Oversacking” Redundancy a false economy say CIPD

Shock horror! I am in agreement with the Chartered Institute of Personnel and Development! (CIPD - the HR professional body). I heard their Chief Economist, John Philpot, being interviewed on PM while driving home. The terminology, like nearly all modern day HR jargon is awful but John warned companies against what he called “Oversacking” of staff during the present crisis.

Not only is redundancy expensive (average of at least £16,300 per worker) but research has shown that in past recessions companies have panicked and unnecessarily made staff redundant then had to incur pointless costs to reemploy when the upturn comes along. Research has also found that redundancies increase staff turnover and reduce the productivity of the staff who are left.

It is urging employers to plan for recovery by retaining their people, rather than downsizing and risking long-term damage to their business... Employers should hold their nerve and focus on retaining talent and investing in the skills of their people. It is these people with their commitment, productivity and ability to add value who will ultimately keep individual businesses and the whole of the UK competitive, and put us in a strong position to recover from the downturn quickly.”

I hope that those Housing associations which are laying off skilled development workers take note!

Check out the press release here (which does not include the “Oversacking” term for some strange reason).


Anonymous said... organisation that sells "training" encourages firms to "train" their staff, instead of working to ensure that the firm itself survives this period of uncertainty.

Charlie Marks said...

Oh, anonymous...

Wealth comes from people producing goods and providing services. Firms won't survive at all if they haven't got the staff to do these things - or if employees are so insecure about the terms of their employment that they begin to lose commitment to the job.

Anonymous said...

to see that Woolworths in Jersey got out of paying a single penny in redundancy

just as the Tories want

regulation light

John Gray said...

Hi Anon

You could question their motives but what they say does make sense (to Charlie and I anyway)