Made redundant? Here’s what to do next

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It can be a confusing time when you’ve been made redundant.

Firstly, there’s the shock of the situation and the fear of what you’re going to do next. Can you afford to wait for another great job to come along, or do you need to find something quickly?

Secondly, there’s the ‘what am I going to tell everyone?’ question, but this one is much easier to solve: tell them the truth, there’s absolutely no shame in being made redundant.

And finally, there are lots of other things that it’s important to double check: are you entitled to redundancy pay? How much are you entitled to?

In the UK, according to the Office for National Statistics, 4 people per 1000 workers find themselves made redundant every year. Considering there are 32,070,000 workers in the UK, that’s a lot of redundant people. If you’re one of those people, it’s hard to know what to do first when you find out.


Steps to take if you’ve been made redundant


Step One: Give yourself some time to process the information

In the immediate aftermath of being told you’re to be made redundant, it’s easy to want to rush into things. You might want to blitz off your CV to every company in a thousand miles, cancel your memberships to the gym and Netflix, or start looking for cheaper places to rent.


Take a couple of days to sit with the information and let it sink in. Once you’ve come to terms with the information, then you can start to act rationally and put together a plan of action.


Step Two: Work out what you’re entitled to

If you’ve been an employee of your current employer for two years or more, you’re entitled to statutory redundancy pay.

That means you’ll get:

  • 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*

As an added bonus, redundancy pay under £30,000 isn’t taxable, which means you see every penny in your bank account. However, there are a few exceptions to this.

You’re not entitled to redundancy pay if:

  • your employer offers to keep you on
  • your employer offers you suitable alternative work which you refuse without good reason
  • you were dismissed (sacked) rather than made redundant
  • you are a former registered dock worker, share fisherman, crown servant, member of the armed forces or police services, an apprentice that is not an employee at the end of your training or a domestic servant that is a member of the employer’s immediate family.


Step Three: Create a budget

Once you know whether you qualify for redundancy pay, it’s time to take a look at your finances. This process isn’t going to be fun, but it’s essential to make sure that you don’t run into any financial difficulties. 

Grab all your old bills, some pens, some paper and a calculator. Sit down and scrutinise your finances.

First, look at how much you’ve got in savings and how much you are entitled in redundancy. Next, look at how much you have coming in each month outside of your employment (benefits and other income). Then, total up how much you spend out each month. Look at food, travel, leisure, bills and rent.

Now, you’ve got your basic incoming/outgoing balance. This should give you a rough idea of how long you’ve got to find a job before you get into choppy waters. It’s a good idea to cut back any unnecessary spending from your outgoings until you find a new job, just to give yourself some leeway.


Step Four: Get back on the horse

Now you know how long you’ve got to find a job, it’s time to dust off your CV, tidy it up and start applying for jobs. If your CV needs a facelift, this article by Monster is a good start.

If it’s been a while since you’ve applied for jobs, don’t be put off. For every ten or twenty job applications you send, you can probably expect to hear back from one, even if you’re qualified for almost every job. According to the Business Insider, the average rate is one interview for every 27 applications you send.

Although it can be disheartening to send so many applications and hear nothing back, don’t get down on yourself. It has nothing to do with your quality as a candidate, and more to do with the nature of the beast. Keep your chin up and send an application to any job that you think you qualify for (and want, obviously). To improve your chances of getting an interview, make sure your cover letters are top-notch and personalised for the job.

If you can’t afford to wait for a perfect job to come along, then there are a few options open to you:

  • Job Seekers Allowance can help provide some much-needed income while you’re looking for a new job.
  • Start a side-hustle to bring in money and keep things ticking over. From writing articles online to walking the neighbourhood’s dogs, there are many ways to bring in some extra cash to keep the lights on. We’ve written about some ways you can make money online before, why not check it out?


Step Five: Take time for yourself

Being made redundant can be a blessing in disguise. You can take time to do things you’ve always wanted to do, learn things you’ve always wanted to learn or make that career change you’ve been putting off.

Quite often, in hindsight, people find that being made redundant was the best thing that could have happened to them.


If you’re struggling

If you’re struggling after being made redundant, there are lots of places you can get help for free:


The Advisory, Conciliation and Arbitration Service gives free advice on everything to do with employment, including redundancy. You can reach them on 0300 123 1100.

Citizens Advice Bureau

Your local bureau can give free advice on what to do after being made redundant. Find your nearest office and arrange an appointment.


* the statutory redundancy pay you will receive looks at the age you started with your employer, so if you started work at the age of 39 and were made redundant at the age of 42, you will only qualify for the one and half weeks’ pay, for the years you were aged 41 and over.


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