It’s no question that Cumbrian businesses are facing increasing pressures, particularly as the imminent National Insurance and minimum wage increases come into effect next month.
The reality is setting in. From April, employers will see National Insurance contributions rise from 13.8% to 15%, alongside a reduced threshold for contributions. The National Minimum Wage is also increasing.
While these measures aim to put more money into workers’ pockets, the burden on employers – especially small businesses – is significant.
The changes have come at a difficult time. Businesses are already contending with rising costs, especially with energy bills and materials.
Some employers have told me they see no alternative but to cut hours or make staff redundant to stay afloat.
My view has always been that redundancy should never be the default response to financial strain.
I would say it’s the last resort. I always advise employers to explore other avenues first. Whether it’s redeploying staff, reducing hours or reviewing employee benefits, there are ways to manage costs that don’t involve letting people go.
When businesses approach me about redundancies, the first thing I do is help them see the bigger picture.
Redundancy can have unintended consequences, from the loss of key skills to damage on morale and productivity of the rest of the team.
Employers must ask themselves whether they’re making a decision that fits into their long-term strategy, rather than simply reacting to immediate financial pressure.
I know many business owners feel conflicted. They want to pay a fair wage and support their staff, but they’re being asked to absorb significant financial hits with minimal time to prepare. It’s a difficult balancing act.
If I had one bit of advice for businesses, it would be: don’t wait until the last moment to act. Planning ahead is essential. Whether it’s restructuring, finding cost-saving measures or making sure you’re compliant with redundancy law, early preparation makes a big difference.
Most importantly, don’t rush the decision. Knee-jerk reactions can have lasting consequences.
Take the time to assess all available options and, if needed, seek expert guidance.
