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Preparing for recession & redundancies

Preparing for recession & redundancies

What should organisations be doing to prepare for a recession & possible recession-related redundancies? The following are 20-year HR and payroll outsourcer myHRdept’s top tips for leaders, based on significant experience of previous recessions:

Top tips for preparing for recession and for redundancies

  1. Brush up on your redundancy skills or find a qualified cost-effective HR partner like myHRdept – cheaper than using employment solicitors, outsourcing support functions like payroll and HR can also offer substantial savings.
  2. For any recession redundancy exercise the priority should be to ‘cut the fat, not the muscle.’ Not a nice phrase, but it is quite descriptive. Good quality departmental selection criteria are a good starting point – senior managers should be thinking now about how (and who) they will choose to lose as salary budgets come under pressure. Also, don’t forget the dignity aspect – redundancies are sometimes necessary, but that doesn’t mean they have to be cruelly executed.
  3. Model what post-recession recovery could look like – organisations that get this wrong will struggle to respond to resurging demand – look at the airlines for example. (For more on this topic see our linked-in article:
  4. Update your organisation charts – Tied up with ‘1’, up-to-date org charts supplemented by key employee information (commencement of employment, age, salary, date of birth) will aid restructuring decisions and save a lot of time when the pressure is on.
  5. Highlight your most recent joiners and those with less than 2 years service. This will be the least risk route to headcount reductions, but would that lose any key recent joiners and, if so, what can be done to avoid or mitigate that?
  6. Highlight any temporary or agency workers…..again these tend to be the earliest casualties when recessionary redundancies are necessary.
  7. Prioritise training commitments and capital projects – you’re not going to keep budget for everything, so be clear – now – on where your priorities lay and construct your arguments to retain these – what will they add to the bottom line, what would the organisation lose out on if they don’t happen, or happen later when better economic conditions return (which they will). Are there any contractual penalties from pausing or aborting projects, and, if so, what are they?
  8. Can you outsource supporting functions like payroll and HR? The answer is nearly always ‘yes’ – many larger organisations outsource ER and employment law to myHRdept for example – cheaper than using solicitors and allows a slimmer internal HR team to focus on a more value-added HR agenda– is now a good time to talk to HR & payroll outsourcers like myHRdept?
  9. Prepare your communications, focussing on reassuring those remaining about the innate strength of the organisation and future plans for re-growth. lastly….
  10. …remember that following every recession is a recovery. Revisiting point 2, ‘cut the fat, not the muscle’…..if you allow CFOs to cut too deeply, they will not be able to benefit from early recovery opportunities. This is probably the hardest boardroom conversation of them all.

HR support from myHRdept

myHRdept provides support for redundancies – all of our staff are trained in collective and non-collective (smaller scale) redundancies. We can help employers prepare for and carry out effective and legally compliant redundancy campaigns. As a 20-year HR outsourcing supplier we can augment or completely replace internal HR functions, depending on the organisation’s size and complexity.

If you’re thinking of outsourcing your HR or employment law needs, why not contact myHRdept? Call us on 01628 820515, email us at to discuss your requirements, or contact us via our website and we’ll call you back.

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