Many employers expect to make permanent redundancies from Covid-19 crisis

(2 minutes to read)

CIPD: ‘Making redundancies should be a last resort once all other options for reducing workforce costs have been taken’.

Although over half of UK employers will look to furlough their staff, as many as one in four expect to have to make permanent redundancies because of the Covid-19 crisis.

This is according to a recent joint survey carried out by the CIPD and People Management magazine.

The survey looked into how employers are responding to the Covid-19 crisis with regards to managing their workforce, hiring plans for the immediate future and accessing government support.

The survey also found that 19% of employers have asked staff who are not classed as essential workers to still attend their place of work. This perhaps highlights the fact that many employers have found the government’s classification of essential and key workers confusing.

Other findings revealed:

Strong demand for the government’s Job Retention Scheme for employers facing workplace closures and/or a financial hit to their organisation. Employers are:

  • Planning to temporarily lay off staff (furlough) through the Government’s Job retention scheme (52%)
  • Asking staff to take annual leave (35%)
  • Temporarily deploying staff to other parts of the business (26%)
  • Reducing people’s hours (25%)
  • Freezing or deferring pay rises (24%)

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Hiring expected to take a hit over the next few months as employers assess demand for products and services: 

  • More than half (52%) said that all hiring has been frozen
  • A quarter (25%) said they would continue to hire but less than normal
  • One in seven (14%) said hiring would continue as normal
  • 4% said that would continue to hire and need more staff to cope with demand

Despite government intervention, permanent redundancies are expected:

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

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.

Ben Willmott, head of public policy at the CIPD, commented, “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.”

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Why Dolan Accountancy?

Dolan Accountancy was set up by Simon J Dolan, the man behind the well-known brand SJD Accountancy. With over 25 years experience in the contracting marketing, Dolan Accountancy has the heritage, reputation and credibility you can trust. Working closely with our sister company, Contractor Umbrella, it means we can offer one low cost, fixed fee package at £95 + VAT per month. This gives you the flexibility of using both our Limited Company Accountancy Services and our award winning Umbrella Service, for one inclusive cost. We don’t believe in tiered packages or hidden extra fees, instead we aim to give you everything you need, including:

  • Free Company Formation – This is where it all begins. Once you have decided on an available name, we will form your company free of charge (if using our accountancy services) and it will be ready for you to use in as little as three hours.
  • Free use of Contractor Umbrella – With changes in Public Sector IR35 Legislation we understand that sometimes you are required to contract via an umbrella company. We will keep your limited company ticking over, while you work margin free via our sister company, Contractor Umbrella.
  • A Dedicated Accountant – Your accountant will be there for any company or personal tax advice that you require. We will never outsource work, even to internal teams.
  • Free Access to FreeAgent – The founder behind the multi award winning FreeAgent platform was one of Simon’s first clients, therefore it only seems fitting that we offer all of our clients access to FreeAgent, free of charge.
  • Free Business Banking – We have decided to waive our commission so our clients can use Tide free of charge for the first year.
  • Unlimited IR35 Status Reviews – We will review all of your contracts for IR35 purposes and provide you with our professional opinion as to its status.
  • Free Registered and Director’s Service Office Address – Sometimes you just don’t want your home address on display at Companies House. When you sign up to our accountancy services, we will offer the use of our address as an alternative.
  • Your Business and Personal Taxation Needs – This includes Company Accounts, Director’s Personal Tax Return, VAT Returns, Payroll, Corporation Tax and Dividend advice, to name just a few.
  • Same day payments- We offer same day payments as standard providing funds are received into our account by 9am, for no additional fee.

If you’d like to find out more about how Dolan Accountancy can help you and your business, please give us a call on 01442 795100 or email or