Since 1st January this year approximately 143,760 people have been made redundant in the UK. With unemployment at its highest level for 12 years, according to the Office for National Statistics (ONS), many companies do consider making redundancies as the answer to their cash flow problems.

But is it really that simple?

We all know what  redundancy means for employees but what does it mean for the companies that are making them? Do they really know what they are dealing with?

Redundancy should not be a path that companies decide to go down lightly. To enter the process without suitable preparation is incredibly risky and can leave bosses open to legal claims from angry ex-employees, potentially costing them more at a time when they are trying to cut costs. Compensation for unfair dismissal could be as much as £66,200 per person – and that doesn’t include the cost of redundancy payment.

At a time of recession the numbers of people being made redundant inevitably increase and this causes problems for employers and employees alike.  It seems that it could particularly be the smaller companies, without the support of HR departments or legal advisors, that find themselves in hot water.

I suppose the answer is to be careful, to be aware of the laws and rights on both sides. The only real way to make the bumpy ride as smooth as possible for everyone.