This post was updated on 05/08/2020 in line with new information and an increase in redundancies due to coronavirus.
Losing your job is one of the hardest things you could face in your life.
The combination of emotions can be overwhelming, leaving you depressed, stressed, anxious and your confidence severely knocked.
For those who have experienced it, redundancy is horrible. It can come out of nowhere and can feel like the world is ending.
It’s a difficult topic to talk about as very few of us like thinking about the negative until it happens.
With the increase in redundancies due to the effect coronavirus has had on businesses, it’s sadly going to affect a lot of people.
Coronavirus & Redundancy
Redundancy is affecting more and more people because of coronavirus, with 600,000 employees dropping off the payroll in May compared with two months prior.
With the Government’s coronavirus support schemes set to end later this year, the likelihood is that many more workers will be made redundant over the coming weeks.
Redundancy due to Coronavirus DOES NOT affect your statutory redundancy rights, which are written into employment law.
A new law passed by the Government means that being on furlough will not affect your statutory rights to redundancy pay or the relevant amount of notice.
The new rules ensure:
- Any statutory redundancy pay you’re due MUST be based on your normal wage.
- If you’re made redundant on or after 31 July 2020, the rules make clear that any statutory redundancy pay you’re due MUST be based on your normal wage.
- Under the furlough scheme, some employees are only earning 80% of their normal salary – however, if a furloughed employee is laid off, then redundancy pay needs to be calculated based on 100% of their regular wage.
- Being on furlough doesn’t affect your statutory notice rights either.
- So employers, like with redundancy pay, still need to provide the same amount of notice as before the coronavirus crisis.
- The furlough scheme supplements rather than replaces employment law and rights.
- This means your other normal redundancy rights still stand.
- Your employer CAN require you to take your annual leave.
- Employers can give a notice to an employee requiring them to take holiday. The fact that you’re on notice does not stop this. However, employers have to give twice as many days’ notice as the amount of holiday the employer wants you to take.
Steps To Take After Redundancy
Step 1: Understand the reasons why
It’s your job that’s been made redundant, not you.
There are lots of reasons why you could be made redundant:
- Your role in the company or the service you offer is no longer required
- Your role in the company no longer exists
- Your employer is looking to cut costs
- The business is closing down or moving site
Whatever the reason may be you need to remember to not take this personally.
We realise that it is going to feel very personal but the vast majority of cases, there is nothing personal about it.
However, there are laws protecting you regarding redundancy to stop you from simply being dismissed.
If you suspect you have been treated unfairly then you need to speak to either the Citizens Advice Bureau or ACAS.
Step 2: Check Your Contract
After you have taken a deep breath, dig out your contract.
There should be a section around dismissal and what you are entitled to in the case of redundancy.
Read over this to make sure you are being given everything you are entitled to.
There are guidelines, rules and laws that all employers must follow when making anyone redundant, so you are going to want to check these are being adhered to.
If you’re being made redundant, you might be eligible for certain rights, including:
- redundancy pay
- a notice period
- a consultation with your employer
- the option to move into a different job
- time off to find a new job
You must be selected for redundancy in a fair way, for example, because of your level of experience or capability to do the job. (Source: GOV.UK)
You cannot be selected because of age, gender, or if you’re disabled or pregnant. If you are, this potentially could be classed as unfair dismissal. If you are
Your employer should:
- Give you a written explanation of why you’re being let go
- Give you at least one week’s notice if you’ve been employed between one month and two years
- Give its employee representatives (i.e. union) 30 days notice if they are making between 20 and 99 redundancies
- Give its employee representatives 90 days notice if they are making over 100 redundancies
- Try and find you alternative work in the organisation if possible.
Now, sometimes, your employer will be selecting individuals out for redundancy. If this is the case there are a number of factors that can single you out as a candidate.
- last in, first out (employees with the shortest length of service are selected first)
- asking for volunteers (self-selection)
- disciplinary records
- staff appraisal markings, skills, qualifications and experience
Your employer can make you redundant without having to follow a selection process if your job no longer exists, for example, if your employer is closing down a whole operation in a company and making all the employees working in it redundant or if you’re the only employee in your part of the organisation
You have the right to appeal against your redundancy.
If you feel that you were not properly consulted, you have not been given adequate compensation, or you have been discriminated against in any way, shape or form, you can take your case to an employment tribunal to dispute the decision.
You are also entitled to redundancy pay if you have been with the company for two years or more.
You should receive a written explanation of how your employer calculated it.
The amount you are compensated will vary depending on your age, and how long you have been with the company.
You’ll normally be entitled to statutory redundancy pay if you’re an employee and you’ve been working for your current employer for 2 years or more.
- Half a week’s pay for each full year you were under 22
- One week’s pay for each full year you were 22 or older, but under 41
- One and half week’s pay for each full year you were 41 or older
The length of service is capped at 20 years.
If the company has gone into administration or has other financial difficulties meaning that they cannot afford the payment, the Redundancy Payments Office may make the payment. To calculate how much you would be owed you can use the government’s redundancy pay calculator.
For full information about your rights surrounding redundancy please check the GOV.UK Page or the ACAS website.
Step 3: Organise Your Finances
The following advice is taken from Money Saving Expert and edited for clarity. However, an important note to make is the following advice can and should be implemented before you lose your job.
- Updating or creating a budget so that you can cope with the adjustment in income versus your outgoings
- Find ways to cut back on your bills. Use a comparison or a switching service to find the best deals on your bills and insurances
- Minimise and get rid of as many debts as you can, particularly credit cards and payday loans with their high interest rates
- Check your contract and the redundancy pay calculator for any potential earning that could be coming your way.
- Look at your savings and see how long you can last with this money
- Look at alternative ways of making money such as temporary work or “side hustles”
Audit Your Finances
The loss of your job equals the loss of funds. Now while you may have savings or even a secondary job to help cushion the blow, the loss of a paycheck always hurts.
You will also have to be aware of your credit score.
Your credit score while working will usually be much better than if you lose your job.
Lenders and credit providers are less willing to accept people who can’t pay back their debts immediately.
Therefore, if your existing debts aren’t at cheap rates, it’s best to apply sooner rather than later to cut costs.
There are lots of tools out there to help you with this.
Pay off debts
If you’ve any spare savings, use them to clear outstanding credit cards or loans.
Having debts hanging over you during redundancy is a nightmare. The cost of most debts vastly exceeds the interest earned on savings.
Don’t use all your money paying off debts.
It’s important you keep access to emergency funds if you need them.
If you decide to repay debts, but it takes longer than planned to find a new job, you may need money later on for day-to-day living.
Check out mortgage help schemes
If you have a mortgage, work out what level of protection you have if you were to lose your job.
Both private, work-based and government schemes may help. There are also insurance policies around mortgage protection payments so check to see if you have taken any of these policies out.
Do a budget & money makeover
We all know the importance of having a budget, however, if redundancy is looming (or has happened) then definitely revisit this.
There’s nothing more important than running through all your finances to see what bills you can cut and doing a full budget to ensure you’re spending within your means.
Explore coronavirus-related support
Numerous measures are in place to support people whose incomes have been directly impacted by coronavirus.
This includes credit card and loan help, overdrafts, car finance, and energy support, as well forms of payment holidays.
To be truly prepared, if losing your job’s likely, start living now as if you’d already lost it.
Cut back on everything, and put spare cash away to help you live when there’s less income.
This way while you’re living tighter for longer, the depths won’t be as deep.
Step 4: Look after your Mental Health
We’re not going to lie, it’s going to be a whirlwind of emotions. It can be a really heavy burden to bear, especially if you have a family relying on you.
The old adage “a problem shared is a problem halved” has a lot of truth behind it.
If you know that becoming redundant is a possibility in the near future, talk with your partner about this before it happens. This can give you time to process and prepare.
When it does happen, talk to your partner about the next steps you are going to take and have a frank discussion about how you will cope financially.
Don’t forget to talk to your children about this change. You don’t have to go into detail, but do explain that you will be looking for a new job.
The trick here is to reassure them whilst being honest about the changes that are happening.
Depression is a common side effect of job loss with men being especially susceptible. One in seven men develops depression within six months of losing their job, according to figures from Mind. It’s thought this is because men, in particular, often define themselves by their profession.
“Regardless of gender it’s crucial that people have access to support to help them overcome the day-to-day challenges they might face,” says Rachel Boyd, information manager at Mind.
“We know that difficult life circumstances, such as debt and unemployment, can have a huge impact on our mental health. If your feelings are impacting your day-to-day life, then try opening up and talking to someone you trust about how you are feeling. Visiting your GP is your best bet as they can outline the different options available to you.”
While it is important to start looking for new employment, don’t dive headlong straight into this, as you need to take time to care for your own well being too.
Self-care techniques, physical activity and mindfulness can help manage symptoms of stress or mental health problems and prevent things from getting worse.
If you are concerned or need someone to talk to please call Mind on 0300 123 3393 or the Samaritans on 116 123. They are free and can provide help.
Source: Huffington Post
Plan Your Next Steps
Now, you are looking for a new role. This can feel like there is a lot of time pressure as the money you have received as redundancy pay begins to dwindle.
Be calm and plan your next steps. This may feel like the last thing you want to do after the whirlwind of emotions you have had. Trust us it will help in the long run.
Now is the time to start looking for work.
You can always contact your local Job Centre and ask for their Rapid Response Service – they specialise in helping people who have been made redundant.
They will help you find a new job and may even pay for training.
You can use the service during your notice period and for up to 13 weeks after you’ve been made redundant.
Or you can go to your local recruitment agency to see what work is available. They may even have immediate start temporary roles available to help tide you over until you can find something more permanent.
You should also ask your employer for a written reference, as you can send this with your job applications. This will help fill in the blanks for your new employer.
Please note: You won’t get any redundancy pay if you accept an alternative job with your current employer before the end of your notice period.
Your employer may also have invested in an outplacement scheme. This is something you should enquire about as this can be helpful in streamlining your application into new roles.
Being made redundant is horrible and can feel like it has come out of nowhere.
It can severely affect your confidence, your finances and your mental health.
It is, however, something you will overcome.
If you really want to stay with the company (and if feasible) you can always try negotiating part-time hours or a drop in wages with your employer.
You should only do this if you are still financially comfortable with the adjustment.
During that time, however, we do recommend you continue your job search and use this period as a bridge between your next role.
Don’t be scared or ashamed about being made redundant. Remember this isn’t personal and does not reflect on your ability.
It is not a reflection of your work, and you should never start doubting yourself. It could happen to anyone, and it does.
If it all begins to get too much: don’t panic. Here is a list of links that can help you take control and help you
Remember that although this can seem like a bad time, you can turn this into a great career move or promotion for you.
This is the chance for you to go after that career or dream role that you have always wanted.
This is a great time to grow in your career and although tough, you will overcome it.