It is in the mutual interest of both employers and their staff to take a flexible approach to cost-cutting, according to Acas.

John Taylor, the group's chief executive, said the recession had seen more employers than ever before use redundancy only as a last resort.

He noted that the majority of business owners preferred to look at alternatives to job losses, and there will be long-term benefits for this approach.

"Those organisations which have dealt with their workforce in a fair, open, transparent kind of way will reap the rewards in terms of less labour turnover [and] less absenteeism as and when the economy starts to recover," explained Mr Taylor.

"Trying to be innovative, involving the labour force – and their unions where they're unionised – and looking at alternatives to redundancy - I think are really quite strong ideas."

And providing the employer has taken an objective stance when making redundancies, some jobs losses will be understood, he claimed.

Recent research by the Institute of Leadership & Management and Management Today magazine found that businesses who have turned to flexible working and budget cuts during the recession, rather than redundancies, have seen trust in their chief executive increase among their workforces.

Posted by Jenny Arthur