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Annie Hayes

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Half of businesses to axe staff

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More than half of Britain’s businesses are planning on making job cuts despite figures which show the majority of bosses aren’t feeling undue financial pressure.

According to KPMG’s quarterly National Business Confidence Survey, 53% of businesses plan to reduce their staff headcount over the coming months, with a similar number planning to implement recruitment freezes. The news is confusing, given that 84% claim to be not experiencing any financing difficulties at all.

Gerwyn Davies, the Chartered Institute of Personnel and Development’s public policy adviser, told HRZone.co.uk: “Undoubtedly there is a slow-down but doubling the redundancy rate seems to be on the pessimistic side. We are seeing a weakening of the profit margins of UK companies – retail and energy companies are reporting vastly reduced profits; in the financial sector they’re almost wiped out; the impact is on employment levels.”

In related news, HRZone.co.uk recently reported that employers that do choose to go down the redundancy path are ending up in hot water. Hoping to make financial gain, costs are ending up spiralling as they fall foul of employment legislation.

Kylie Coulter, a solicitor at Thomas Eggar’s employment team, told HRZone.co.uk that since the end of 2007, the firm has seen a definite increase in the amount of redundancy advice it has given: “Individuals also seem to be less averse to bringing claims, as in the current economic climate finding a new job is not an easy task. The lack of employment opportunities also means that the amount which a successful claimant is likely to recover is greater, adding to the attraction of bringing a claim. To compound matters, claimants seem less willing to settle prior to issuing a claim as they have less money available and therefore cannot afford to make a significant compromise.

“This triple whammy is likely to have led to a significant increase in tribunal claims and we anticipate that this will continue for the foreseeable future.”

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Annie Hayes

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