ONE OF THE biggest concerns employers in Ireland have is about the lack of flexibility in employment terms, especially during downturns.

The Netherlands has introduced a novel approach to the current economic downturn that is now attracting interest. The Dutch Work Reduction scheme was originally put in to help companies deal with emergencies such as fires destroying production units.

It has recently been extended, however, to companies that can show a decline in production due to economic reasons. Under the scheme, companies experiencing a fall in sales of 30 per cent or more over two consecutive months may apply for financial support. The state will pay unemployment funds to cover 70 per cent of the salary costs for workers who are temporarily laid-off while the company pays the remaining 30 per cent of the workers’ salary.

An alternative to the Dutch scheme has been introduced in Wales in recent months.

Known as the Pro-Act Scheme, it links a short-time work subsidy to longer-term investment in staff education and training.

Employers who can demonstrate that normal hours are being reduced

by at least 20 per cent qualify for grants to use for training that improve productivity and competitiveness.

Employers receive a training subsidy of £2,000 for each worker in addition to a wage subsidy of £2,000 for each participating employee.