Whatever the name, it is a concept that strikes fear into many.
The official meaning of redundancy is “the state of being not or no longer needed or useful”. Obviously it is confronting for anyone to be considered no longer needed or useful, let alone excess to requirements to their employer.
However, redundancy is happening with greater frequency in workplaces around Australia as businesses restructure, downsize or embrace new technologies to reduce costs.
Redundancy is most definitely confronting, whatever the circumstances. But there are ways to approach a possible redundancy to ensure it is a more positive process and to allow you to have more control over your future.
You can survive and thrive in the face of redundancy.
1. Remember this is about your position, NOT about you. By definition a genuine redundancy is when the person’s job doesn’t need to be undertaken by anyone. Which means it’s your position that’s no longer required, rather than you and your unique skills, experience and knowledge. A genuine redundancy process is not about you or your performance – the only consideration should be around the ongoing need for the role you are occupying.
As difficult as it is, you should try not to take the redundancy process as a personal attack on yourself or your performance. You should, where possible, take the personal aspect out of the equation and approach the situation as objectively as possible. Reducing the emotional chains will help you clear your head and allow you to more purposely consider your options.
A genuine redundancy should only be offered when a role is no longer required and will not be filled by anyone else. If you feel your dismissal is not a genuine redundancy you can lodge an application with the Fair Work Commission within 21 days of your dismissal to have the decision reviewed.
2. Make the effort to understand your rights and entitlements. The world of redundancy entitlements can be murky but it is essential you understand all the benefits and support that you are entitled to. This includes understanding the following:
- Redundancy package – understand the amount of the package you are being offered and ensure it reflects your years of service plus any unused annual and long service leave benefits. Also find out about the taxation implications of the payment. If it is a bone fide redundancy, the tax treatment will be different so you need to fully understand the type of redundancy you are receiving to estimate your after-tax benefit.
- Superannuation – are you able to access your super as a lump sum, pension or combination of both? If not, you will need to consider whether to preserve your super where it is or roll it over into another fund. Are you going to close your account or open up your own? It pays to understand superannuation rules and any benefit you may be able to gain from them.
- Entitlements to re-training, career counselling or financial counselling – check to see whether your workplace will support you in these areas. In some cases you can be reimbursed for costs incurred in seeking financial advice or help in updating your resume. Do some research, ask your manager, HR department or union delegate to best understand what support you can access during the redundancy process.
- Right to appeal the decision – if you feel you have been unfairly treated or targeted in a redundancy process you can find legal advice on the Fair Work Australia website. The site also helps you work out your correct entitlements under your award and provides advice on notice periods and other relevant information pertaining to ending employment.
Every workplace is different but it pays to ask questions so you don’t miss out on support and assistance that you are rightly entitled to.
3. Review your budget and seek financial advice. This is essential. Don’t make a decision to accept a redundancy until you know what this means for you and your financial situation. If you don’t already have a budget, make one. You can find a budget planner over at Money Smart by ASIC. A budget will not just assist you in working out where your money is going. It can also help you understand whether you need to seek a job straightaway; whether you need to find another position at a similar pay rate and what expenses you may need to reduce in order to get by without your present income.
Make sure you seek financial planning advice. Financial planners can look at your redundancy package and your budget and advise you on how best to use your package to your advantage. Always clarify the costs associated with financial planning before proceeding and ensure you are dealing with a planner that is registered and reputable. And don’t feel pressured to take up their products or ongoing services – an initial consultation may be all you need to get you on the right track.
Finally, familiarise yourself with government benefits and assistance provided to people looking for work. There will be eligibility tests and waiting periods but if you are not sure you are going to find another position straight away you should understand where you stand with Centrelink – they have a page dedicated to providing advice to people retrenched or made redundant.
4. Plan for your future – consider your career options and seek opportunities for personal development, study or re-training. An offer of redundancy is a great opportunity to look at what you are doing and evaluate whether it is what you actually want to do. If so, see if you can get assistance in professional development or resume polishing or further study to help you secure another job in your field of expertise. This could be of particular use if you have been with your employer, or in your role, for a long period of time.
If you do decide to try something new, have a look at the employment market in your chosen field to see whether there are jobs available. Determine the necessary qualifications required, investigate study options, enquire about relevant professional associations and join online forums to get a headstart on your new life.
Whatever you decide to do, try and map out a plan of action. Give yourself purpose and direction. Set tasks and goals and take them seriously. It is important you have a plan to follow so you can move forward and achieve the most from your redundancy.
5. Think positively – see this as an opportunity. Losing your job is a scary thing, whether you welcome the redundancy or not. It is so important to look at the situation as positively as you can. Changing your mindset and seeing redundancy in a more positive light can open up so many opportunities.
It might be the kick start you need to start the business you were always planning on starting. It might be an enforced circuit-breaker, allowing you to travel and spend more time with your family before heading back into the workforce. It could be the opportunity to change direction and begin a whole new career. It might be the ideal time to de-stress, have a break and rediscover what life is really all about.
Redundancy is confronting. Redundancy is scary. But you can survive redundancy and come out the other side much happier and more fulfilled than before.