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Facing Redundancy

Losing your job can be devastating. A blow to your pride and your self–esteem.  You may feel your worth as an employee has been devalued and you may never recover. As dark as things may seem after the news there is a lot you can do to help yourself get back on the road to a new job.

The first thing to remember is that your situation is not unique. You are not the first and you won't be the last to find yourself in this position. The current recession means that there are thousands of others in the same position. And - most importantly - there is a great deal of support and help available for anyone that is made redundant.

Think ahead.

If you are still in work and you believe redundancies are in the offing, don't just wait for the letter to arrive. Get out your CV and update it. Start looking around to see what is in the marketplace. Look at signing up with a recruitment agency. Consider adding another string to your bow by retraining to another area of law. Look at training options available.

What to do if your job does go

You are losing your job, so don't be afraid to speak up. Remember it is not you that is being made redundant. It is the post or the job. There may be other opportunities within the firm. If there are and you want to stay, don't be shy in asking.

If your employer has not made the reasons for the redundancy clear, don't be afraid to challenge the decision and the process that is being followed. An employer has to show that any redundancy is a genuine one and you have a right to know about the selection criteria being applied to the post.

 Check out your contract and find out about your rights and your entitlements. You may be paid in lieu of notice and untaken holidays and there may be arrangements for bonuses and commission that will add to the total due to you.

Many firms also have a redundancy package or agreement and there is always the possibility that you may be able to negotiate an improved package for yourself.  If there is a package, the first £30 000 of the redundancy sum is tax free, but you will pay tax on the rest, including salary and any benefits or entitlements you receive.

 If others have been made redundant in the past from the firm, try and find out what package they received and compare with the one offered to you Are the terms the same? Have any bonuses or commissions been included?

For those who don't have access to a company redundancy scheme or agreement, the law provides a statutory redundancy pay agreement. Statutory redundancy pay is based on a calculation which uses your age and length of service.

The total amount you should be paid for redundancy will be based on:

  • how long you have been continuously employed
  • your age
  • your weekly pay, up to a certain limit (current maximum £350)

You will get: 0.5 week's pay for each full year of service where your age was under 22.

  • 1 week's pay for each full year of service where your age was 22 or above, but  under 41
  • 1.5 week's pay for each full year of service where your age was 41 or above

Try the BERR redundancy calculator to give you some idea of the likely sums involved.

Relevant end date for your years of service

The number of weeks' redundancy pay you should receive is calculated up until a set 'relevant date'. It is important to know when this date is so you can work out how many years service you have. For example, if you started work for your employer on 1 March and you were given your redundancy notice on 15 February, you would need to calculate if your last year's service can count towards your redundancy pay.

The relevant dates can be a number of dates, but in most instances it will be the date when your employment ends (eg the last day of your notice period). In some situations this will be different:

  • if your employer gave you a statutory notice period up until a set date, and then changed your notice period to finish earlier - the relevant date will be when your notice should have expired before it changed
  • if you are on a trial period for another position within the company and your employer lets you go because the work is not suitable - the relevant date would be when your original contract ended before the trial period with the new position
  • if you are not given the statutory notice period (eg because of a payment in lieu arrangement) - the relevant date would be when your contract of employment would have ended if you were given the statutory notice period. 

The ACAS web site has details of your legal rights or call them on 08457 47 47 47.  Open Monday to Friday 8.00 am to 6.00 pm.

And if you believe your employer has not followed the statutory procedure you could always consider taking them to an employment tribunal.

Sign on at the Job Centre

Do this as soon as you can when you have left work. This means your national insurance will be paid and you may be able to claim JobsSeekers Allowance and other benefits. Statutory redundancy payments have no effect on your entitlement to contribution-based Jobseekers Allowance. If you have lost your job through redundancy you normally qualify for Jobseekers Allowance.

You cannot claim Income Support or Income based Jobseekers Allowance if your personal resources, including redundancy pay or unfair dismissal compensation, exceed £8,000. You may however, qualify for contribution-based allowance.

Contribution-based Jobseekers Allowance depends on the status of the worker's national insurance contributions. You will need to have paid national insurance contributions for one of the last two complete benefit years before the tax year in which the allowance is claimed, and have contributions or credits for both benefit years. Jobseekers Allowance is paid for six months, maximum.

More information on the Job Centres web site.

Am I entitled to any other benefits?

There is a wide range of benefits and entitlements available to individuals.

Other benefits and entitlements which may be available include:

  • Housing Benefit
  • Local Housing Allowance
  • Support for Mortgage Interest
  • Council Tax benefit
  • Employment or support allowances
  • Income support
  • New Deal programmes
  • Benefits for Higher Education students with low incomes.

More information on the above is available from Direct Gov

More useful information can also be found on Advice guide.org.uk

Check your finances

Being made redundant may mean a period where there is no money coming in. If this is the case don't delay or ignore the fact. Check the state of your finances. If you believe you are likely to have money problems or difficulty meeting bills let you bank, mortgage lender, credit card company etc know straight away.

They are used to helping people who find themselves in this situation and will work with you to provide a solution to your problems.

Don't leave it until it is too late and becomes a serious problem. The Citizens Advice Bureau will also be able to help with advice in this area if required.

You can avoid tax payments on redundancy settlements above £30,000 by paying the surplus - up to the equivalent of your annual salary - into a pension fund, thus avoiding up to 40% tax.

This is particularly beneficial if you are over 50, as you can take 25% out of your pension immediatley as tax free cash. But this concession will change in April 2010 when the age will be raised to 55.

You can also protect yourself against unemployment with insurance, but there may be strings attached to policies. Best to check with your insurance company.   

ILEX Benevolent Fund

For those members facing financial hardship the ILEX Benevolent Fund may be able to provide limited help. The Fund was set up to assist members (past and present) and their dependants in the UK when a sudden financial hardship occurs.

The Fund can provide a range of assistance, for example, to provide financial help to cover unexpected or unusual bills, utility bills, the purchase of something to help ease a disability or to cover membership or exam fees. 

The Fund relies on donations from ILEX members, ILEX branches and other public bodies and the amount of funding available is limited. The amounts paid out are mostly small one-off payments and the Fund should be viewed as a 'last resort' by anyone considering applying for help. When considering whether financial assistance can be given, the Fund's Trustees expect applicants to have availed themselves of any State benefits to which they may be entitled. 

An opportunity

If you have just lost your job you may not think this is the right time, but redundancy is an excellent time to reassess your career or your life plan. A time to reflect; look back at what you have achieved and what you still want to do, decide where you want to go. A time to change direction, maybe do something completely different.

Consider whether this is a good time for re- training or learning new skills. You may want to add to or build on your experience by taking on further training.

Perhaps you may want to reassess your work life balance, do locum work, go freelance or offer consultancy. Perhaps you have always harboured a secret desire to do something totally different, turn a hobby or pastime, something you really enjoy doing, into a business. This could be the time to consider making the first step towards that. Many a successful business or career has been started as a result of redundancy.

Have a plan

Once you have lost your job consider the task of looking for a new job as your current job. Approach it in the same way as you would approach a problem in the workplace.  Don't rush in all directions; take time to consider all the angles, the prospects, the opportunities, the pitfalls and drawbacks. Don't necessarily jump at the first job that comes along (unless it is really the one that you have been looking for all your life of course); take good financial advice if you are considering a business opportunity or venture.

And get a plan together.  But don't just have one. Go for plan A of course, but also have a plan B or even a plan C ready just in case your original plan does not work out. It is surprising how positive you will feel if you have a goal to aim towards and a plan in place to achieve it.

Share your problems. Share your dreams.

A trouble shared is a troubled halved, so they say and so it is with plans. Think about what you want to do. Talk it over with your wife, husband, partner, family or closest friend. Discuss the pros and cons of where you want to go and what you want to do next. Be positive and work together to formulate a plan of action.  Take their advice and welcome their support. If you do find things are getting on top of you, don't be afraid to seek professional advice if you think you need it.

Law Care provides ILEX members with excellent support and counselling for those in need.

Tel: 0800 279 6888. Lines open 9:00am -7:30pm weekdays 10:00-am- 4:30pm weekends.

Keep in Touch

Whatever plans you may have for the future stay in touch with ILEX. It is important you do not let your membership lapse. If you are having difficulties with your subscription we can help spread the cost for you through monthly payments.  Keep your CPD up to date. Members who are not working are eligible for dispensation from CPD for the length of time they are unemployed. if you are having problems let us know. If you are staying within the profession and are thinking of moving to a new discipline we can help with retraining through a range of courses at discount prices from the ILEX Tutorial College.

Stay sharp

You want to stay on top of the game, so why not look to voluntary work to keep your legal skills honed. There are a large number of voluntary organisations that would welcome good quality legal assistance or help in other areas, including the Citizens Advice Bureau.

Your local council or library are good sources of information and contacts.

Judicial ambitions

Legal Executive lawyers may now apply for a range of judicial appointments. If this is something you have as an ambition or maybe as part of your long-term work plan, now would be a good time to look towards achieving this, a good opportunity to really find out what it is all about. Why not consider work shadowing a judge? This is an excellent way of getting a feel for the role.

Or perhaps you want to apply to be a part of one of the mock role exercises the Judicial Appointments Commission (JAC) organise on a regular basis.  You will not find a better way of learning more about the selection process – and you get paid. There is also the added bonus that all the above will count in your favour if and when you do apply for a judicial appointment.

And don't forget many judicial appointments are part-time. More information on this from the  ILEX web site and the JAC web site.

Go For it

Redundancy can be tough and demoralising. No one likes to feel their worth as an employee is not valued but if it does happen to you, there is so much help and advice available and so many things you can do to get yourself back on track again. ILEX is here to help and is just one of many organisations that are available to listen, advise and assist those going through the pain of redundancy.