Retrenchment – what should I do?

Retrenchment is one of life’s most stressful events. While losing your job this way might feel like rejection, it’s not. Retrenchment isn’t discarding the person; it’s dispensing the role.

Whether the decision to take retrenchment is yours or it is something over which you don’t have control, it can be an unsettling time full of mixed emotions. You might feel angry or suffer a loss of confidence, or you may be relieved that now you have a chance to do something different. If you have worked in the same job for a long time the idea of such a change can seem overwhelming.

Here are some of the things to hold onto if you are facing this challenge. Although it is not necessarily an ending you may have wished for, it represents a new beginning with all the opportunities that can bring.

Know your rights
An employer is legally bound to consult with its employees (and their union), through a process called consultation, if they wish to dismiss 15 or more employees.

You will usually be entitled to redundancy pay, otherwise known as severance pay, and you should be told during consultation how much you will receive. Severance pay may not be paid in all circumstances, for example by a very small business, or to casual workers. The amount of severance pay to which you are entitled is linked to your length of continuous service with your employer; this does not include any unpaid leave. If you lose your job because your employer goes into administration/liquidation, you may be able to get financial help from the Australian Government.

Keep a clear head
Your sense of security can be undermined and you may initially feel shock. If you can remind yourself about what you are good at and look to polish up skills that you may not have had to call on recently, this will help you to stay positive.

Prepare a budget
You may be about to receive a large payout from your employer, but before you spend it all work out how much you will need to live on until you find new work. Start with a budget and list all the costs you incur, including for mortgage or rent, utilities, food, transport costs, and insurance. Remember to think about your super, too; any break in employment will affect your super balance.

During any period for which you have been paid severance you will not be eligible for Centrelink payments. If you are not paid any severance, you may be entitled to Centrelink benefits including those to assist with any retraining.

Accept help
If you are offered help from your employer to find a new job, such as career counselling to update your CV, or work profile, take it. There may be other suitable roles within the company for which you can apply. Ask your current employer to provide a reference for you so that you have this ready for applications for new roles.

Plan what you might do next
Being told that your job is no longer required is a good opportunity to think about what you might want from your next role. Perhaps in your most recent employment the hours haven’t suited you, or there are skills you haven’t recently had a chance to use. You might pursue further training to gain new qualifications.

You could think about volunteering, which will give you a chance to try something completely different, and may lead to new employment, or an idea for a different role.

Take a break
Going through retrenchment can be a very draining experience, so try to allow yourself to have some time out; if you have prepared a budget for living, you may have some money leftover for that trip you have always wished you had the time to take.

Read more at Australian Department of Employment website. See also the DHS website’s redundancy page. Another helpful resource is the Fair Work Ombudsman website.

Have you ever been affected by redundancy or are you facing this situation now? What steps did you take to face this challenge?

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Written by Alice Bell


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