The new package of financial support for business and employees during the current crisis announced by the Government means that businesses struggling financially now have an alternative to making their staff redundant – that’s the message from business expert Oliver McCann of regional law firm Napthens.

He said: “The new measures should ensure that employees as well as businesses can continue to support the wider economy. Employees are consumers as well as workers, so this is crucial to sustain business as a temporary measure across all sectors during this time.

“Without this support, the UK was looking at unprecedented levels of lay-offs without pay or redundancies which would have created an inevitable decline to a severe recession as consumer affordability would have declined drastically.

“The message to employers is simple – there is now a viable alternative to redundancy dismissal. You can temporarily lay off staff. This is where staff remain employed but are not provided with work if you cannot afford to keep them or there is insufficient work, and the government will fund 80 per cent of their salaries up to £2,500 a month as long as the employee is “retained” by the business. This is also being backdated to March 1st so should help those already being affected.

“This allows employers to trim labour overheads to meet reduced demand, but given this crisis is expected to be temporary, it enables the business to retain its experienced and trained staff until this is over which will be critical to enable the business to pick back up quickly once this is over. Making staff redundant is usually a last resort, so these measures will be welcome relief for employers and employees alike.”

He said other support for business would help including a break in VAT for the next quarter and interest-free business interruption loans for 12 months, rather than the six months previously announced.