How much do the long term unemployed (LTU) cost the Exchequer? I am referring to people who have been unemployed over two years.
A simple solution would be to allow companies special exceptions if they employ these people.
The first is "instant dismissal" under the following terms. This isn't to start until the LTU has been with the company for a month. In other words, the company has to give the LTU person a fair crack of the whip. However, during the following five months, the employer can dismiss the LTU instantly for any reason. Then for the following six months (until the end of the first year) the employer can give the statuary warnings and then dismiss them but the employee loses the right to take the employer to an industrial tribunal for unfair dismissal although he doesn't lose any other rights in this area.
In return, the company pays no NI contributions for that year, and the LTU doesn't either.
What will this give both parties?
The employer: A chance to assess someone who has not worked for over two years whilst knowing he can get rid of them if they really are hopeless.
The LTU: A chance to get back onto the work ladder.
The Exchequer: The loss of the NI contributions will far outweigh the benefits given to keep the LTU and their family houses, clothed and fed. And for those back in work on a long term bases, the benefits will be enormous.
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