“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).