THE bite of the credit crunch is fuelling a boom in demand for employment law advice, Liverpool solicitors are reporting.
Businesses feeling the financial squeeze are looking to save costs and cut overheads.
And as the spectre of redundancies looms ever larger, the city’s law firms are seeing big increases in companies seeking advice.
Peter Mooney, head of consultancy at the Employment Law Advisory Service, said he has seen a marked increase in enquiries from across the business spectrum.
Last week alone, his practice spoke to three different manufacturing companies about reorganising their business, including the need for redundancies.
He told LDP Legal: “One manufacturer is switching its operation to Germany, meaning the UK site will become solely a distribution centre and we’ve witnessed similar closures and assimilation policies across the sector.
“Businesses in the service sector are also feeling the pinch – we’ve even acted on behalf of a London law firm which has been forced to lay off a handful of solicitors.�
Mr Mooney is tipping the food sector to be the next to look at downsizing as businesses struggle to cope with the rising cost of raw materials.
The region’s employment law experts agree that, rather than being a blip, the upturn is down to the gloomy economic climate.
Charles Millett, employment law specialist at Morecrofts Solicitors, said: “At Morecrofts, we are receiving more and more enquiries from business owners and employees seeking advice on employment issues such as redundancy.�
Mr Millett said it is imperative for employers to seek legal advice prior to putting any plans into action.
Not doing so could land a company with numerous and costly legal proceedings as employees drag their cases through tribunals.
He is advising clients to take out insurance against the risk of being taken to tribunal and to sign up for packages where legal advice is provided at a fixed annual rate.
But he was also seeing more employees who had been presented with compromise agreements detailing redundancy packages.
Mr Millett said it is just as important that employees receive professional advice.
“A lot of our clients have been told by their employers that they are simply a ‘rubber stamping’ exercise.
“Compromise agreements are complex legal documents and they require in-depth advice from a specialist employment lawyer. Without this, employees could be signing away their rights to bring claims without receiving adequate compensation.�
Nick Campbell is employment partner with Brabners Chaffe Street LLP, who with 20 solicitors specialising in employment law have one of the biggest practices in the country.
He said: “We are certainly experiencing an increase in enquiries as firms face up to the prospect of business reorganisation and redundancy proposals.
“As the market continues to take a turn for the worse, redundancies tend to become more commonplace so we anticipate an increase in litigation.
“In the present climate, employers are becoming more aware than ever of the need for specialist employment law advice before they embark on any proposed business reorganisation.�