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The Confederation of British Industry
(CBI) has made a proposal for an
'Alternative to Redundancy' (ATR) scheme
which could be introduced as part of a
package of measures to reduce job losses.
Under the proposal employers would be
able to use current redundancy procedures
or place employees on the ATR scheme for a
period of up to six months. The employees
would not work during the ATR period but
could seek employment elsewhere. They
would receive an allowance of twice the
rate of Job Seekers Allowance, which is
currently approximately £50 and £65 a week
dependent on age.
The proposal is that half of the
allowance would be paid by the government
and the other half by the employer. The
employees could then go back to work once
the ATR period expires or the business
improves.
John Cridland, CBI Deputy
Director-General, said:
"The worst of the recession may be over,
but businesses still face a long
convalescence and the dole queues will
continue to grow. The alternative to
redundancy scheme could save jobs by
giving businesses more leeway as the
economy recovers.
We considered various forms of wage
subsidy and support for short-time
working, but this approach is better.
Businesses will be more able to cope with
sharp drops in demand and prepare for
recovery, while workers benefit from
improved financial support and a door that
is kept open for six months.
This is not about businesses ducking their
redundancy responsibility - in fact if a
scheme runs for six months and a
redundancy is still made then the business
will end up paying more.”
For information on the calculation of
statutory redundancy pay use the
Department for Business Innovation and
Skills link below.
Internet links:
CBI press release
BIS website |
