The CBI has called for the government to introduce an alternative scheme to redundancy as  unemployment continues to spiral towards 3m in the UK.

In the report, published in association with Siemens, the CBI has suggested that employers who have run out of cash and are unable to pay salaries, would be able to enter employees  into a scheme co-funded by the government where workers would stay at home for 6 months and receive payments of double the job seekers allowance. At the end of the period, the workers could then be fully re-employed or made redundant if conditions had not improved.

The scheme is seen as off setting the traumas of redundancy and allowing businesses to take a break from salary payments.