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

Anic

Hi

My OH is being made redundant and his last day at work is this Saturday.

He has asked the Accounts Department when he gets his redundancy payment and has been told that as they get paid this Thursday and it hasn't gone through with this months wages he will probably get it when next months wages go into the bank.

Although I have never been made redundant before, I didn't think that was right, I was under the impression that you should get your redundancy payment on the day you leave the Company, along with your P45 and any paperwork and/or outstanding wages/expenses/holiday paymnets that are due to you, etc as technically you no longer have a contract with them and shouldn't really have any more dealings with the Company.

Am I right and if not can anyone clarify what should happen

toobigaspenda

I was made redundant in March this year after 16 years with the same Investment Bank. Having just returned from maternity leave it was quite a shock but having not been around for 9 months I could see that the company I had left had changed.

I had mixed feelings about leaving and was given as long as I needed to find another job internally. After 4 months of looking I actually realised that I didn't want to stay and my husband and I had already been thinking about moving away and starting again.... maybe emigrating to Australia.

I knew that even if I did find another job I wouldn't know if I would like it or not so asked to be put 'At Risk' This gave me a 12 week get out clause if I found another job but didn't like it and could still take the redundancy. The only challenge was that if I didn't find another job I would have been made redundant, which I was sure I wanted. My company agreed to put me at ris and my 30 days started. During this time my managers allowed me to apply for other jobs hoping that they didn't have to find me something else, which would have meant them doing something!!

Eventually I started talking about the terms I wanted to leave on and would suggest you considering some of the following:

1. You can ask to have your notice paid in lieu but you will lose out on the
following:-
i. Pension payments that you would have received while garden leave which in my case was 12 weeks worth. This wasn't such an issue for me as I'm only 34 but could be more important if your 45+.
ii. My healthcare cover finished on my last day so if you don't take garden leave you lose the additional x weeks cover. If anyone is being treated on a current plan you'll need to agree for that to continue beyond your end date.
I also spoke to the companies healthcare provider who offered me an ex employee rate for when I left which was up to 25% off their normal prices. Sometimes critical illness cover is extended 3 months beyond your end date, so you could also lose out on the 12 weeks cover if you would have been on garden leave.
iii. You also loose out on the opportunity to find another job within the same company if you don't have the 12 weeks garden leave, however if you've made the decision to go you probably won't be that worried.
FYI - Once you have been given your at risk notice you could accept another job and you and/or your new manager would still have a 3 months trial period and either party could decide that this job isn't right but as you would have already served your at risk you could go straight on notice and you would still get your redundancy....this option could buy you another 3 months.
iv. You cannot claim jobseekers allowance until the day after what would have been the end of your notice period, but if you let the Dept of Works and Pensions know they can arrange for your NI stamps to continue if you give them a ring on 0845 602 6710.

On the positive side you can start another job immediately so for me this outweighed the financial losses. I would have hated for a contract to have come up and me be tied into my old company and not have been able to have accepted it as you don't know how long it will be until the next offer!

2. There is statutory redundancy that's also due to you, here's the link to the calculator http://www.dti.gov.uk/er/redundancy/ready.htmit's based on your age and length of service. Currently there's a limit of £290 a week that you can get.

Here's an overview of what Tax & NI contributions you have to make on any redundancy pay you get http://www.hmrc.gov.uk/guidance/redundancy-factsheet.pdf
If you currently get an annual bonus you could negotiate getting some of next years bonus included in your package.

I also worked out how long my monies would last and how long we could survive without me working. I used MSE and the time I had off to review all of my outgoings and changed all of my suppliers as I had been paying over the odds for years. I also switched my ISAs as they hadn't been paying the best rates for a few years all things I never got round to do when working full time.

As I had more time I used http://www.petrolprices.com to find the best petrol prices in my area and would make sure I drove that way home if I was going out. This saved me at least £2 pound every time I filled up.

Beware most firms pay any additional monies over the 30k tax free amount at 22% so you will need to side away the rest for when the tax man comeths, I maximised mine and my husbands ISA's for 2005 & 2006 & the tax I put into Premium Bonds and hoping my numbers come up and preferably not just the £50 prize.

Also if you leave and then take a permanent job back at the same employer within 12 months they sometimes make you pay back a pro rata amount of your redundancy pay, however you will never have to pay back the Statutory pay. That's yours for you to keep and never has to be returned. Always remember you can go back temping/contracting/consulting at any time after you finish as long as your not going back to the same job.

I also got to keep all of my share options but they must be exercised by their expiry dates... the next ones are due this December just in time for Christmas shopping!

I also got paid and extra £100 for keeping my 'Compromise agreement' confidential. I also used the companies placement services but didn't find them all that useful or confidential with other colleagues being made redundant at the same time! There was far better information on the web with much more practical information!

Funnily enough I did find another job before my notice would have finished, working back for the same company, contracting and on three times as much money! I' m also just about to get my contract renewed for another six months so there is a god!

Taking redundancy was a hard thing to do as I left some great friends behind but it has also given my family and I the chance to change our lives for the better. It's given my husband the confidence to leave his job after 16 years and find a bigger and better one in London... so 5 weeks to go until we relocate to the big smoke with our daughter.

Paul_Herring

tamste wrote:

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.

If you're after putting it away towards your pension funds, you may be better off putting the extra into a personal pension (perhaps 'stakeholder', but not necessarily.) Best advice would be to re-post your question over on the Pensions, Annuities & Retirement Planning board

MMF

I had 13 years service so statutory notice was the max 12 weeks. I thought it was great when they let me go after 4 weeks. BUT

What I wished I'd known...

My insurance was linked to signing on at the DWP (i.e. the old dole, or jobseekers). Job seekers doesn't/won't start until the end of what would have been the full notice period, i.e after 12 weeks, so I went 8 weeks without being able to sign on (BUT YOU HAVE TO REGISTER WITH THEM STRAIGHT AWAY - DON'T WAIT!).

I therefore went 8 very dry weeks before my insurance kicked in that I hadn't budgeted for - so it took a bit of a chunk from my redundancy payment!

If I'd known, I'd have served my full notice. Food for thought - may depend on your policy.

MMF

Probably really obvious but....

If you're insured (i.e. have redundancy protection insurance of some kind), it more than likely only applies in CR (Compulsory Redundancy) situations, and NOT if you step up and take VR (Voluntary Redundancy).

k8ielou

I was off sick from an RSI caused by my job. The problem I have is that I have "Cervical rib syndrome" This means that I have an extra rib (in my neck) and the job has caused damage to the nerves and tendons that are being stretched over the extra rib. While I was off sick, the company made myself and four others redundant. I received a letter dated the 4th of september, telling me that i would be made redundant on the 8th of september. I was not even given a weeks notice. I was not called in for talks, or to try and relocate within the firm to something I could do. I also feel that i was singled out because of my (now) dissability. ( I have limited use of my right arm and am due to have surgery on the 23rd of this month for removal of the extra rib and my first rib.) My job was a 40hr week and i actuallly, because of the stupidly low pay, worked 56hrs aweek. Because of this i believe i was picked for redundancy because of my "problem". That is unfair. I am seeking legal advice and have been told that i have a case for unfair dissmissal and also dissability discrimination. I have issued a grievance letter and am due to attend a meeting next week. I will keep you posted.
Regards kate

mrsb2100_2

Hi,

Although I was made redundant in 1999, the mistakes I made back then are something I will remember for the next time ... if, and when, it happens.

Like so many of us, at that time I saw redundancy as a way to clear some of our debt and saw it as an opportunity to get out there and find a better job. Because I didnt think things through properly at the time, once that cheque was cashed, I paid lump sums off our credit cards & cleared the overdraft we had. We had mortgage insurance cover, so that was fine.

However, what I didnt consider was how long it would take to get another job. I took the first temp job I could (at a vastly reduced hourly rate) out of desperation, without realising that once my 3 weeks temping were up, I couldnt claim again on the mortgage insurance. This is when I realised paying off credit card debt before securing a new job / long term contract was a bad idea. We now had no money other than benefits and my husbands salary. Thankfully, the mortgage was paid from his salary, but everything else had to wait ... including utiliy bills. I had no transport at the time (I was learning to drive) so all the interviews I had, I had to be sure I could get to on public transport, or within walking distance. I also had to be sure that I had some money for the interviews I had.

So, my advice would be, hold on to your redundancy UNTIL you have more secure employment (contract, long term temp or permanent!), if you have mortgage insurance, use it - you've paid for it, thats what it's there for! Be a bit more picky than I was. Dont pay off your debts however tempting it is, until you've got a new income. The mistakes we made back then, we're still paying for ... and paying off.

But the most important thing to remember - you are still a valid human being and it's just the job thats gone ... not you.

Andy_L

robert_harper_2000 wrote:

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?

The new guy should have allowed for this in how much he pays for the company.

Joolsey_2

Hi,
I was given notice by my employer two weeks ago that my job may be made redundant. I am currently on maternity leave for the next 5 months - my daughter is only 3 weeks old so got the news at the worst time.

Can anyone advise me as to the companies responsibilities regarding continuing to pat stat maternity pay etc?

I am one of a team of 8 sales people & I am advised that the company needs to cut the team down to four. I fully expect to be one of the ones to get their P45 as they were very unhappy when I told them of my pregnancy & made life quite difficult for me, despite being one of only 3 people who hit their annual sales target last month.

I would be grateful of any advise - Thanks.

ClarkeEJ

I was made redundant when I was on maternity leave a few years ago... get advice ASAP... I took then to a tribunal and won compensation as they made me redundant for reasons connected to my pregnancy which is sexual discrimination.... get advice from the Citizen Advice Bureau as soon as you can....

Take a look here:

http://www.eoc-law.org.uk/Default.aspx?page=2980

http://www.eoc.org.uk/