Your wages bill may be your largest financial commitment, but it does not stop there. Your total committed staff costs may include many commonly overlooked items.

For instance, don’t be fooled into thinking your recruitment costs will be nil due to the recession. People continue to move jobs. And if you want to counter the effects of the downturn, try taking advantage of the talent that will be available on the market.

At the other end of the employment relationship, if you are planning to reduce or restructure the workforce you need to factor in redundancy costs. And don’t be tempted to underestimate the role of professional support in avoiding litigation as a result of a redundancy programme.

Total committed staff costs should include:

• All wage costs.
• Cover for holidays and other absences (see our Holiday Entitlements Factsheet).
• Benefits – cars, food subsidies, life assurance, pensions, health cover, staff discounts and private health insurance etc.
• Pay rises and bonuses (including deferred).
• Recruitment costs (see our Recruitment in a Recession Factsheet).
• Training.
• Unreclaimed Statutory Sick Pay (see our Managing Sickness Absence Factsheet).
• Redundancy payments (see our Making Redundancies Factsheet).
• Professional HR support.

The second part of the picture is labour flexibility. To meet today’s challenges you need to know what flexibility you have to rework your operations as needed. To give you maximum flexibility, ensure you know and understand the implications of:

• The employment status of every staff member.
• The terms of engagement of contractors and agency staff.