Signs That Employers opt for Alternatives to Redundancy

DUBLIN - Eurofound Maps Employment Measures at Company and Member State Level
in Europe:

There are signs that EU governments and companies are opting for
employment-maintaining initiatives, as opposed to redundancies and lay-offs,
as they look to ride out the storm of the current financial chaos. A new
report from Eurofound, the Dublin-based EU agency maps innovative and good
practice government and company measures to keep workers in employment. It
shows how companies are using short-term working, paid/unpaid sabbaticals and
‘pay for jobs’ clauses in restructuring agreements and how social partners
are reacting to these developments.

Many EU governments have short-time compensation programmes in place
whereby employers can apply for temporary state assistance to top up the
wages of workers working reduced hours. Generally, these programmes are
conditional and negotiated agreements between the social partners, subject to
specific market conditions and declines in sales levels. The report outlines
the workings of the systems in place in Germany, France, the Netherlands and
Austria as well as the bill currently being discussed by the Slovenian
government.

Employers are also looking to retain staff through the economic
turbulence: one sign of this being the increase in offers of paid career
breaks. Such measures are mainly found in the UK and Ireland according to the
report, mainly since company-level initiatives involving both wage and time
flexibility are more likely in countries where there are no collective
frameworks of agreed working time flexibility.

The report also examines why companies prefer to avoid forced job cuts.
One reason is certainly the financial cost of redundancies but there is also
widespread anecdotal evidence that companies have been chastened by previous
experience of downturns where the dismissal of trained and experienced staff
undermined efforts to restore levels of production during the recovery phase.
In some countries, public schemes to finance temporary layoffs and reduced
working times provide an incentive for companies to use these mechanisms.
Also, human resource management policy in large firms may be more focused on
the medium to long term than previously was the case, where unfavourable
demographic profiles in many countries will severely limit labour supply.

The report clearly outlines the risks with measures intended to secure
the survival of viable businesses through short-term difficulties, and that
these may not be so effective in a protracted slowdown.

Download the report from
www.eurofound.europa.eu/publications/htmlfiles/ef0920.htm

Note to the editor

The European Foundation for the Improvement of Living and Working
Conditions (Eurofound) is a tripartite EU body, whose role is to provide key
actors in social policymaking with findings, knowledge and advice drawn from
comparative research. Eurofound was established by Council Regulation EEC No
1365/75 of 26 May 1975 and is located in Dublin, Ireland.

You can register for regular news and information from Eurofound at:
www.eurofound.europa.eu.

For further information, contact Måns Mårtensson on email
mma@eurofound.europa.eu or telephone +353-1-204-3124 or mobile
+353-876-593-507.

Source: Eurofound

For further information, contact Måns Mårtensson on email mma at eurofound.europa.eu or telephone +353-1-204-3124 or mobile +353-876-593-507.