Pay freezes rising, IRS research reveals

The recession is having a serious effect on employee benefits and pay as new research has revealed that basic pay awards have slipped by three per cent in the three months leading up to the end of January 2009.

That is according to research undertaken by Industrial Relations Services (IRS), which has also revealed that an increasing number of companies are looking to make pay freezes.

The IRS has estimated that a quarter of those companies which conducted pay reviews in the sample group had opted to enforce a 12 month pay freeze to help them weather the economic storm, and over half of January pay deals were set lower when compared with 2008.

Commenting on the results of the survey, Sheila Attwood of IRS, said: "A focus on January 2009 pay settlements confirms the view that a combination of lower pay awards and pay freezes is in prospect as the
new year unfolds.

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"RPI inflation is expected to continue falling, putting further pressure on the level of pay rises."

Jaguar Land Rover has stated that if its staff take up the offer of year long pay freeze and a four-day week, there will no compulsory job losses for two years.