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Dealing with redundancy in the UK

made redundant

Turn employment redundancy into an opportunity

If you've been made redundant, or are being asked to consider taking voluntary redundancy - to paraphrase the World War 2 poster - KEEP CALM AND DON'T PANIC
Many people have been in the same position, and have found that they are capable of developing their skills into a successful home-based business or job.

man made redundant and leaving work with box of personal stuffRedundancy can hit almost anyone, at any time. Jobs that were previously considered 'jobs for life' are now facing the axe, as businesses, councils and government departments struggle to cope on reduced budgets. There's plenty of practical advice around on what to do when you're made redundant, but it's also worth considering looking beyond just applying for a new job.

Think positive - you can deal with redundancy

Consider how being made redundant can be turned to your advantage and be a positive turning point for you. Your redundancy could be the push you need to review your working life, and perhaps this is the moment you realise you can start up the business you've always dreamed of, or choose to leave the 'rat race' behind and work from home, using your skills, energy and drive for your own business.

'Every exit is an entry somewhere else'. Tom Stoppard

The enforced time-off when you are made redundant has been used by many former 9-to-5 workers as a breathing space, to reflect on what direction they want their life to go in. However, unless you are lucky enough to have come out of the job with a large redundancy payment, you will need to start earning a living as soon as possible.

But will you get back on the treadmill as an employee again, or will you take the opportunity to create the lifestyle and business you have always wanted?

Starting your own business is easier than it ever was in the past. Selling anything from crafts to consultancy services, is much simpler now via a web site, and as long as you've got a phone and internet connection, you can work from home with generally no investment and minimal running costs.

What to do when you have been made redundant in the UK

The most difficult part of starting a new business for many would-be entrepreneurs is coming up with a good idea. If you've got an idea or skills that transfer easily to self-employment, then you're up and running, but if you are stuck for a business idea, then it's worth taking time to decide what you want to do. Finding a gap in the market that you think you could fill is a good place to start.

There are lots of business ideas on this site and lots of them just require enthusiam and common sense, rather than a particular skill set. They require varying levels of financial investment from zero up to thousands of pounds, but they are all things that people have made money at.

If you haven't got that particular skill or hobby that you feel you could develop, you could consider training to enable you to run your own business.
Next you'll need to find out the level of investment needed.

Running a business for yourself can seem daunting if you've always worked for someone else, but the ingredients for success are qualities that you've probably already got. Working for yourself can be scary at first, as you don't have the support infrastructure of working for someone else. There's no-one else to blame if things go wrong and if you don't do something yourself, it doesn't get done - the buck stops with you!

But, on the plus side working for yourself can bring big rewards, not only in financial terms but also in being able to structure the kind of work-life balance you want. Running your own business can be enormously fulfilling and enjoyable - if you've only ever worked for someone else, you'll be amazed at the buzz you'll get from landing a new customer, making a sale or tying up a deal!

Check out whether you tick the boxes to

be your own boss


Redundancy in the UK - what are your rights?

Selection for redundancy can be made on a number of criteria, such as length of service (last in-first out), disciplinary record, skill or experience levels. It can NOT be made on criteria related to age, gender, race, sexual orientation, pregnancy, disability, religious belief, membership or otherwise of a union, or whether you work full or part time.

Your redundancy entitlement
Firstly check out your contract - what is your notice period and your contractual rights?

You are entitled to work out your notice period, or be offered pay in lieu. You may also be entitled to statutory redundancy pay, if you have been working continuously for your employer for at least two years. Employees aged between 22 and 41 years are entitled to at least one week's pay for every full year of employment. Older workers are entitled to 1.5 weeks' pay for every full year you worked.

redundancy rights - office workers discussing the options

If you've been selected to be made redundant, you are entitled as a minimum, to at least one week’s notice if you have been employed up to two years, or one week’s notice for each year between two and 12 years, or 12 weeks notice if you've been employed for 12 or more years.

If your employer intends cutting the jobs of 20 or more staff, then legally they must consult the union or representative more than 30 days before issuing notice to the employees (this notice consultation period increases to 90 days, if it concerns more than 100 employees). Your employer should also inform you personally of your redundancy, and discuss any alternative options open to you.

Consider your redundancy terms

When you are notified about your redundancy, don't feel you must agree your dismissal / severance terms at the initial meeting. Find out the details of the proposals
( it's a good idea to write the figures and terms down), and then take time to consider what option suits you personally.

It is worth taking financial advice before you agree to the redundancy terms, as there are important tax and pension factors to consider. For instance if your redundancy payment is transferred directly into your pension, then you are not then liable to pay national insurance contributions.

If an employer does not follow redundancy law with regard to notice period or selection criteria, they may lay themselves open to a claim for unfair dismissal and the wronged employee would then be likely to be awarded compensation.

Leaving work

When you finish work you should receive any pay you are entitled to, including any accrued holiday pay, and redundancy pay. Make sure you also receive a P45 and
a letter stating the date of redundancy.

Find out more about your rights on redundancy uk at the Direct gov site - Gives full details of redundancy pay, statutory redundancy, redundancy notice period, acas etc.

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