Small businesses consider cutting staff as downturn deepens

Small businesses will have to make redundancies as the country heads towards recession, the Forum of Private Business has said.

The FPB’s legal advice line experienced a 68% increase in calls on employment in September. Redundancy is the main issue for FPB members, with 12% of total calls relating to redundancy situations.

More than one in three calls (35%) received by the FPB’s member helpline – which is a separate service to the legal advice line – were from members concerned about employment issues. More than 9% were specifically about redundancies.

Banks tightening their lending facilities and the cost of  utilities are getting out of control, said the association. More than 50 new regulations came into force on 1 October 2008, including an increase in the minimum wage, additional maternity and adoption leave rights and regulations on occupational pension schemes.

FPB policy representative Matt Goodman said: “With the UK teetering on the brink of recession, it is inevitable that redundancies will take place. The FPB is urging business owners to follow the correct procedures in order to minimise the pain for both employees and businesses.”

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