The Great 'What to do in the event of redundancy' Hunt

SuffolkBunny

Hi,

I've been made redundant twice and this is what I did.

- first time was over 10 years ago. I decided to use the payout to go back to university to do a masters degree. It meant I could get out of London where I was working and spend a year chilling out and reassessing what I was doing. Plus get good advice from uni, etc. I was 27 at the time. At the time I was told I was going, I was also asked to remain working to complete some work although some of my colleagues where told to stop work straight away. Then because I said I was going to uni and had a few months before course started (and I hand chosen where I was going then) I managed to stay working for the company until late August. I learnt several lessons as a result. Most important was that it is the position that's redundant not the person - several colleagues resigned during the 3 months I stayed on for. Several people who remained thought I had missed out by not going, however my manager took me aside and said that my position was still redundant and if I wanted to stay I could take one of the vacant positions or go at end of August. I still left and had a great year at uni.

Interestingly several of my not so educated colleagues loved my idea of using redundancy pay to finance a course before job hunting or in other cases did some training courses while looking for work. Some even used contacts made on those courses to get new jobs.

- second time was 3 years ago. This time I took the outplacement services that were offered to get my CV in shape and some analysis/feedback on my CV, interpersonal skills, etc. I then took time out to complete an MBA that my employer had been paying for (I just needed to pay the final year part which was only a small sum). I had sufficient funding from selling shares in my former employer and other means to live off, however I put my redundancy pay into premium bonds so I could easily access it if I needed to. I signed on for JSA as soon as I could (which is immediately with redundancy unlike if you resign where you have to wait a month before receiving anything). A year later I was back working doing what I wanted to do with alot better pay and quality of life.

The trick with redundancy is take a stock of what you have and what you want and use the money to get more of what you want ! Whether that be a better job or better quality of life. Think of it as a bonus both in money terms and in terms of time to think and assess what you and/or you family deserve to have and then take a (preferably big (risky!)) step in that direction. You can usually achieve more than you realise !

kit-kat_3

I chose to take voluntary redundancy (VR) back in June - I had come to hate my job over the last year and had had a really tough couple of years (marriage breakdown) so could do with a break. My company was trying to shed 1400 employees and to encourage those who wanted to, enhanced the statutory payment. It then became VERY tempting so I sat down and thought about it seriously.

I was now on my own with two children to support (shared responsibility and finances relating to the children with my ex, but even so, needed to provide my half), so couldn't make any rash decisions. I decided I could survive for twelve months if I was very careful and more importantly I could afford to take a pay cut if necessary - having kept an eye on the job market, I was quite confident of finding something, just not necessarily something at the same salary. I also decided what I wanted in the ideal world: the summer off, starting a new job mid-September, with some money leftover. Finally, I figured that if I didn't have a new job by mid-September, I could eek out my redundancy money by getting any old job temping, stacking shelves, bar work, whatever, just to make the money I had last longer.

For me, this made it a no-brainer! I took VR, decided to have a couple of weeks without worrying about it, then start job-hunting seriously.

I threw together a cv so I had something to leave with (though put it through a rewrite a few weeks later). The thrown-together cv I put on the monster website (https://www.monster.co.uk) and others - something my brother happened to suggest when I had a chat to him about taking VR. I also sent my cv out to a few agencies and applied for a couple of jobs I saw when browsing through the paper. This was all before I left my job and during the first couple of weeks of non-serious job-hunting.

I also wanted my money to work for me. In the long-term (ie once I had a job), I wanted to pay off 10% of my mortgage (something I could do without penalties) and have some savings left. In the short-term, I needed access to all my money, incase I needed it. So, first off I worked out how much money I needed to cover my bills, etc until mid-September and left that in an easy access/good interest account, then £3k in an ISA, £1k in premium bonds and £5k in ICICI - all easy to get out if I really needed it later on. I also found that although I didn't have my own account with Lloyds, my joint account with my ex-husband where all the kids money goes, was a current account, so I set up a linked savings account and put the maximum in there at startup and then monthly, feeding it from my A&L account (it was necessary to tell the lady I spoke to that money didn't have to come from a Lloyds account and fortunately, although her supervisor said it was, she checked it out with head office).

Though my two weeks of not job-hunting turned into a few more weeks (I have to admit), I wasn't totally idle as my cv was out there on the web and I still carried on applying for jobs I saw. I received a call from an agency, who had seen my cv on the monster website, about two weeks after I posted it. They arranged an interview which was delayed due to holidays (theirs and mine booked before VR was anticipated) and two hours after my interview, I was offered the job :j I'd already mentioned in my interview that I'd hoped to be off until mid-September and they were happy with that.

I have been very fortunate. I've landed in a job which I am enjoying immensely. I've taken a small pay cut, though gained a final salary pension scheme (amazed there are any still out there!). I've had a good break which has done me the world of good mentally. I've paid off 10% of my mortgage and cut my monthly payment by £50. I have some savings left over (a first for me!). I've made £75 in car boot sales over the summer and about £300 on ebay. I've sorted out all my home paperwork and got a new will written.

However, there were things I didn't consider when I thought it through seriously, which struck me later:
- all of a sudden I had no life insurance, no death-in-service payments, no critical illness as all these I had through work;
- my payment protection insurance wouldn't pay out if I got desperate as I had taken VR (redundancy is different), though I didn't expect it to, it's worth knowing beforehand;
- I don't think I could have claimed any benefits again because I made myself unemployed.

So, hope I haven't rambled on too much and hope above is of some use or interest! In summary, if you get the option of VR and are tempted:
- work out your objectives (summer off, money left over);
- work out your budget (how long will it last);
- work out how big a risk you are taking (what if it lasts too long);
- ensure you can access your money quickly in the short-term;
- work out your contingency (what if the summer becomes autumn then winter);
- use every opportunity to find a new job (internet, job ads, agencies, friends, neighbours).

Good luck!

drdamski

I was made redundant several years ago. I was only 23 and to be honest it was an inconvenience but a bloody good kick up the backside.

It seems that redundancy often triggers the "hmmm, am I doing the right thing with my life... shall I do something different?" thought process. This is not least because of the emotional process that is gone through.

Whilst this is undoubtedly a good time to do this if you already have an idea of what else you would like to do, you can waste time and your redundancy money whilst you mess about with unrealistic pipe dreams.

Therefore my advice is get back on the horse and find yourself a job as quickly as possible. This could even be a temporary job but the key is to get yourself back in the workplace as quickly as possible and get the income flowing again. This helps mentally as well as financially - You can leave the redundancy payment in your savings account earning interest whilst you consider how best to use it (... starting your own business, settling debt, buying a car... etc).

The temptation - particularly as a young person who has not yet found their favoured career path - is to use this as an opportunity not to work at all as it may add up to at least several months' salary. The truth that they may not realise is that it's a golden opportunity to something really useful with the money.

So get back on the Horse as quickly as possible! Then whilst you're doing something you don't really want to, you can be considering what you really do want to do... Make sense?

wildflower

I went through redundancy in 1976, 1986 and again in the early 90s. You move on, sometimes faster, sometimes slower and you usually learn something about yourself. Someone once called it the creative void - an opportunity to reinvent yourself if you so wish. There's plenty of help out there if you want it, in many formats. It is different every time, it depends where the rest of your life is. Whatever happens is right for you. I was once a trustee of an educational redundancy charity :T

MSE_Martin wrote:

Have you ever been made redundant?

The Great 'What to do in the event of redundancy' Hunt

This is a special plea. Recently in the 'suggestions for major articles' discussion someone asked for one on what to do in the event of redundancy.

I think it's a great idea and plan to do it. However beforehand I wanted to get personal experiences and tips from people who have been through it - to help those who have it to come. Please help.

Click reply to leave your suggestions - on as wide an amount of info as you like.

Martin

A_Nice_Englishman

I was made redundant a couple of years ago.

I had 25 years' service with the company and predecessors but didn't like the culture of the foreign company who had taken it over and no longer enjoyed the job or the 90 mins each way commute. The redundancy terms were generous and I got enough to pay off my mortgage.

I found a job straight away 10 mins walk from home which I enjoy immensely
Although the salary was quite a lot less this was compensated by the lack of mortgage payments and travelling costs. The icing on the cake was that they were so pleased with my work that I was awarded a pay rise so that I'm now earning just about the same salary as I was before.

Not everyone will be as lucky as I was, I know, but my message is look upon redundancy as an opportunity and not a threat.

freakshadow4

johnofhertford wrote:

I am hoping to be made redundant this year. I would gain quite a lot financially because of the various schemes that my employer all have preferntial closing terms if one is made redundant compared to resigning (e.g. share scheme all shares can be sold tax free instead of having to wait five years, and first 30,000 of redundancy pay is tax free).

For me it would be a great opportunity to take some time out, maybe change career, or do some voluntary work for a while. Wish me luck!

Hiya JoH, I obviously don't know what your personal situation is, but I would strenuously advise against being too complacent about your impending redundancy! I'd say the same to anyone else in a similar situation.

I was made redundant 2.5 years ago, after 4 years of annual rounds of redundancy. I knew it was coming, and basically held on in a fairly bleak working environment to 'capitalise' on the favourable redundo terms we knew would be offered. Having seen my colleagues swan off with a nice package straight into a new job, I felt confident I could do the same, with good experience and qualifications under my belt.

Unfortunately it took me 8 months to find a job, negating any benefits gained from the lump sum etc! I now recognise that I would have been far better off securing a new job whilst I still had one, rather than waiting for the redundancy package. Being in current employment can give you slightly more leverage with prospective employers.

The advice in the other posts is well worth noting. Redundancy can work out well for some people, but it all depends whether you feel you are one of those people. Is that glass half full or is it on the dole?

As has been mentioned, you should be able to find some form of work out there, through temping at the very least. It might not be what you want to do for the rest of your life, but you will be able to keep a wee bit of money coming in. I temped in a call centre for a few weeks, and hated it - it cost me a day's wages for my week's travel costs - but you should be able to find something. At the end of the day, I gave up temping because I felt it was hampering my job searching - I wasn't spending enough time in the evenings looking for jobs and applying for them! (It was taking me 1.5 hrs each way to get there, though!)

Don't underestimate how long it can take to find the jobs you want to reply to, let alone those jobs you could apply for. I posted my CV on as many internet sites and recruitment agencies as possible, but it can still take forever to tailor your CV and covering letter for each application.

This for me was the most soul destroying aspect of being made redundant - spending so much time applying for jobs that hardly ever acknowledged your application, let alone got you an interview. My wife still 'jokes' about my "8 months off" and having so little to show for it. I really don't think she appreciates how long it can take to apply for a job! And, in line with Sod's Law, the recruitment agencies didn't start generating any useful leads or interviews until I was 3 weeks into my new job!:rolleyes:

Get your CV posted on the recruitment sites as early as possible - it can take a wee while for your details to find the right people!

Be prepared for friends and family to ask about how things are going EVERY SINGLE TIME YOU SPEAK TO THEM! It can get a little frustrating, but just remember that they mean well!

Also, if you can, try to use a proportion of your time doing something like DIY, so you have something physical to show for your time "off". It can help take your mind off that big pile of unacknowledged applications you've fired off into the ether, never to be heard of again...

And when you do finally get your job, try living with the belt tightened as it was whilst you were skint! You can obviously let it out a couple of notches, but it can be the perfect opportunity to live that slightly stricter lifestyle whilst funnelling off your excess funds at the end of the month into your savings or paying off debts! Following this mindset helped us save enough to pay for our wedding!

I did also learn towards the end of my unemployment that the vast majority of jobs are found via the people you already know, so get networking as soon as possible. Get that brass neck polished and ready to use. Get the word that you are looking for work, and ask friends to let you know if they see anything that may be up your street. You never know...

robert_harper_2000

What would happen if the company you worked for was being bought out. Everything would be kept the same no-one would lose their jobs but does this mean the original owner doesn't have to pay redundancy?

He saves the money while the new owner has the worry? surely not fair?

skintchick

I've been made redundant twice - the first time i got 5k, the second time, in February this year, I got nothing.

Rule number one is allow yourself a week to get over the shock. OK, sitting around doing nothing helps no-one, but honestly, you do need to get over it first.

Then budget. You cannot live like you were, no matter ho much of a payoff you got, because you don;t know how long it will be before you get another job. Get over to the DFW board, post your SOA and let them hack it to pieces! Ditch everything unnecessary, and buy the cheapest of eveything else. If you haven;t done it before, now's a good time to swap suppliers for everything possible. If nothing else, this gives you a sense of control, and of being proactive.

Talking of which, get your CV up to date, and start thinking about applying for jobs. Don;t just stick with what you were doing before. Now is a great time to take stock and think about what you want to do.

The first time I was made redundant, I was so bruised from my employment experience (this wasn;t really redundancy, it was a convenient excuse but I was pushed out over a period of months) I doubted whethe rI was in the right career. So I spent £500 of the redundo money on a life and career coach. This gave me a focus for a couple of weeks while I did the exercises and counselling sessions, and made me realise I did want to do my job.

Next, call everyone you've ever worked with, tell them what's happened and ask if they have any vacancies. Don;t be ashamed - people will want to help, and it might be that they'll give you an early nod on something. I always use my contacts. Doing this got me a job back at an old workplace, which was fantastic.

It was that place that made me redundant about none months later, in February this year. Not such a shock this time, and I decided to work for myself.

Use Business Link - they are free and will advise on tax, etc., and provide you with access to other people running businesses in your area so you can share knowledge.

Practially, if you can then get a lodger temporarily if you're struggling to get a job - £300 a month tax free aint to be sniffed at, and I found it also made me get out of bed and dressed, as I was too embarrassed to be in my dressing gown when she came home from work!!

If you don;t want to do career coahing, at least sit and write down all your skills, and all the things you enjoy doing in life, and evaluate whether your work life balance is OK. Now is the time to sort it all out, and get the job you really want.

Always remember THERE IS NO SHAME IN REDUNDANCY. None at all. Everyone will feel sorry for you, and then want to help.

If things get really bad, make sure you sign on (I didn;t, but I couldn;t face the forms and I did get a job fairly quickly), and consider doing any job at all to bring in money - cleaning, ironing, supermarket etc.

Whatever you do, don;t carry on spending as you did before, using up your pot of cash, and don;t get stuck in prideful thoughts that you can only do exactly what you did before - sometimes we have to swallow it and do something we consider a bit beneath us. I did when I went back to my old workplace. I was too good for that job by then, but it was work, and they wanted me back, and I knew I'd love the people, so I swallowed my pride, took a pay cut and did it.

You can always move up again, or move on, but IT'S EASIER TO GET A JOB WHEN YOU'RE EMPLOYED THAN WHEN YOU'RE NOT. Sad but true.

As someone else has said, it isn;t the end of the world, although it feels like it, and you will get something else. Think of it as an opportunity to re-evaluate life and work, and grab the chance as a positive thing.

rich42

Redundancy Situation:

I was made redundant in 2004, with 24 others, when the employer just dissappeared! We have now made it through the legal process, got some money from the redundancy payments office and just got the company wound up and a receiver appointed.

My problem is that I kept hold of my company car - it has sat on my drive for 2.5 years. I guess it belongs to the official reciever now, but I don't want to give it up for nothing (the money recovered by selling all the cars probably won't be enough even to pay the receivers costs, let alone our costs)

I am thinking of telling the receiver to reduce the debt I am owed (about £30K)by the amount the car is worth (about £3K) and keeping the car. Has anyone else been in this situation? What happened?

Regards, Rich

tamste

I am currently at risk of redundancy (46 years old), and as a single postholder in a position that is not required in the new structure, expect to receive my formal notice within the next few weeks. I am doing the usual, i.e. sorting the finances (no debt exept mortgage), looking for new opportunities etc. but am currently focused on the short term.

After 23 years service, I will get a good compensation package such that there may be a significant sum be over the £30k tax free allowance (actual sum dependant on current NHS redundancy review), and will because of my salary level be taxed at 40%. Can I place some of this money that would otherwise be taxed at 40% into an AVC without falling foul of the deprication of assets rule........i.e. place the money into a pension before the tax man takes his 40%, and get him to pay 40% into my plan. I do not have an AVC at present, but my employer (the NHS) do have a couple of linked providers........not sure if its best o go with them or set up my own, though this may depend on whether they can pay the agreed AVC contribution directly before tax.

Any advice at this trying time is greatly appreciated.