Quarter of employers expect to make permanent redundancies due to coronavirus

Over half of employers says they will look to furlough their staff, but one in four expect to make permanent redundancies due to the coronavirus crisis, according to a new joint survey from the  Chartered Institute for Personnel and Development and People Management.

The survey of 301 HR professionals shows how employers are responding to the Covid-19 crisis in terms of managing their workforce, hiring plans for the immediate future and accessing government support.

The CIPD is asking employers to look at all options available to them before making redundancies to help protect employees’ livelihoods and the future of their businesses.

The survey also found that 19 per cent of employers have asked staff who are not classed as essential workers to still attend their place of work. However, it also highlights that many employers have found the Government’s classification of essential and key workers confusing.

Ben Willmott, head of public policy at the CIPD, said: “This survey shows that many businesses are already considering redundancies rather than utilising the Government’s Job Retention Scheme during the coronavirus crisis. Making redundancies should be a last resort once all other options for reducing workforce costs have been taken. Organisations that are most successful in protecting jobs and supporting their employees will also be those that are most resilient and best able to recover once this crisis is past.”

Findings from the survey also show:

• 35 per cent of employers are asking staff to take annual leave because of the coronavirus crisis
• 26 per cent are temporarily deploying staff to other parts of the business
• A quarter are reducing people’s hours
• 24 per cent are freezing or deferring pay rises (24%)

Some 15% of employers expect to lose up to 10% of the workforce; 9% expect to lose between 11% to 49% of employees; and 67% expect no change to headcount

More than half (52%) said that all hiring has been frozen; a quarter said they would continue to hire but less than normal; 14% said hiring would continue as normal; and 4% said that would continue to hire and need more staff to cope with demand.

Some 15% of employers said that some staff have been asked to still attend a place of work despite not being classed as key workers, with 4% saying that most staff are still being asked to go to their place of work despite not being classed as key workers. However, 41% of employers said no staff were being asked to go to a place of work, 30% of employers said some staff were being asked to go to a place of work as they are classed as key workers and 11% said most employees are still going to work because they are classed as key workers.

More than a quarter of businesses (28%) have found guidance on who is a key worker either not very or not at all clear, with 54% saying that it had been reasonably clear and 18% saying it had been very clear.

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