How to cope after being made redundant
You’ve put your shoulder to the wheel working long hours to meet a deadline when you’re called into your manager’s office. You’re told that due to financial cuts your job has been made redundant. You return to your desk, reeling from the shock. You didn’t see this coming. Questions keep replaying themselves in your head.
Why you? What did you do wrong? How are you going to survive financially? How are you going to explain this to your family?
Unfortunately, redundancy is part and parcel of modern workplaces. Approximately 26% of Australians will experience a redundancy at some point in their careers – that’s 1 in 4 people.According to an article in the Sydney Morning Herald, Australia has a higher rate of redundancy compared to other developed nations. Factors like digital and technological advancementsas well as off-shoring and financial downturns mean that redundancies are on the rise.
In simple terms, a redundancy is when your employer terminates your employment because they either decide that your job is no longer needed, or they become insolvent or bankrupt. Yes, you will get a redundancy payment to tide you over the next few months, but how do you get on with life without feeling worthless?
What are your entitlements?
A redundancy package will include a redundancy or severance payment and your unused annual leave and long service leave. It may also include a payment in lieu of notice and a 'golden handshake' payment to sweeten the deal. However, you are not paid accrued sick leave when your job is made redundant. If your employer has gone into administration or liquidation and you are owed entitlements after losing your job, you may be able to get financial help from the Australian Government through the Fair Entitlements Guarantee.
4 steps to take after being made redundant
- Keep calm and carry on.
- Get your finances in order.
- Assess your skills.
- Get back into the job market.
1. Keep calm and carry on.
Remember, it was your role that was redundant – not you – so try not to take it personally. It is normal to feel that you failed, but remember that it was just business. You will go through a gamut of emotions – fear, shock, anxiety, and sometimes even depression – so acknowledge your feelings but try not to let them bog you down. Talk things over with a good friend and, if needed, get professional help. Australians are entitled to 10 gap-free sessions with a registered psychologist if referred by a GP, so avail of these services if you feel the need. A recent SEEK study found that 60% of Australians who were made redundant found another job within two months, so chin up!
2. Get your finances in order.
First things first, check all paperwork and your redundancy payment to ensure you are getting paid fairly. You have 21 days to double check your payments, so make this a priority. The Fair Work Ombudsman has an estimation service and other relevant information related to redundancy payments, so it would be worth your while to ensure you are getting all your entitlements. You may also be able to access Australian Government assistance to support you through Centrelink benefits. Also go to the Department of Human Services’ website for a wealth of information from claiming your unpaid entitlements to managing your money.
Next, set up a separate bank account with your redundancy payment and other cash savings; this will become your “salary” until you get a new job. You can put it in a mortgage offset account if you’re paying off a home loan. Talk to your bank manager and service providers (gas, electricity, internet) asking to pause repayments or negotiate a better repayment if you are struggling to pay loan repayments, credit cards or bills. Similarly, ring around for a better deal on your insurance (car, home, health, etc.).
Review your household budget and weekly expenses and work out how many weeks’ income you have in hand. Now tighten those purse strings by stopping all discretionary expenses (that new outfit/takeaway meals/your daily $4 coffee). You’ll be surprised how much you can save when you no longer spend money on work lunches or catching an Uber to work.
3. Assess your skills.
Do you really have what the job market is looking for? Or do you need to study further or change career paths? Now might be the perfect time to re-train or reassess your career goals. Think of your redundancy as a blessing in disguise; a catalyst to finally make changes you’ve been meaning to do. There’s no excuse now that you have the time and opportunity.
Many of the skills you acquired in your old job might be transferable to another role in a different field. For instance, if you worked in admin for a small business, you could easily apply these skills to find something similar at a large corporation.
However, if you want to change career paths, now is the perfect time to do a course to achieve it. Upskilled has a wide variety of short- and long-term courses ranging from human resources to project management, so check them out.
4. Get back into the job market.
Get your CV in order – update it and get a friend to review it so that it highlights your skills and experience favourably. Make sure you update all work-related online profiles like LinkedIn. You need to be digitally-savvy while job hunting.
Furthermore, don't rely solely on job ads; instead network, network, network. Nowadays, 60-70% of jobs are in the hidden job market, got through word-of-mouth and referred to by friends and colleagues. Use any industry contacts you have – call up an old boss, email your school friends, catch up for a coffee with an ex-colleague. Let them know you are willing and available to work.
Getting a redundancy is never easy, but with the right steps taken, you can easily get yourself back on the horse into the workforce before you know it. In the meantime, you might want to read up on our other career advice on SkillsTalk – to make you an even more valuable worker in the eyes of potential employees.
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