As the unemployment rate edges closer to 3 million, the Confederation of Business Industry ( CBI ) is proposing to introduce measures to allow employers to maintain their existing staffing levels throughout the recession. The Alternative to Redundancy ( ATR ) Scheme would give employers the option of placing an employee on ATR for up to 6 months, as an alternative to making the individual redundant.
It has been proposed that an employee on an ATR Scheme would not work but would be paid an allowance twice the rate of Job Seekers Allowance, half of which would be covered by the Government and half by the employer. Therefore, whilst there would be an additional cost to employers, there would be no additional cost to the Government and the employee would have time to seek alternative employment. Alternatively, the employer would have the option to take the employee back into the workplace on expiry of the term of the ATR , or earlier, if business has improved. Therefore, the benefit to the employer is that it can retain employees during a short period of financial difficulty. If at the end of the scheme circumstances remain the same, the employee retains his rights on redundancy. As with a redundancy situation, the employer would require to consult prior to implementing an ATR Scheme.