Why you should think about taking voluntary redundancy
The UK is still in a precarious financial position. That means a lot of companies are looking to trim back on staff. You might be nervous about being made redundant, but if you grasp the bull by the horns and take one of voluntary redundancy packages that are often touted around the company, it can put you on the path to a happier life.
Voluntary redundancy packages are often exceptionally generous, for a start. They can leave you with a solid nest egg that can tide you through any retraining programme or get you started in a whole new town if you fancy a move. If you wait for the enforced redundancies that almost inevitably follow the voluntary offer then you can find yourself in a far worse position.
Statutory redundancy pay only comes into force when you have worked at a company for two years and even then it is hardly generous. Staff members under 22 get just 0.5 weeks’ payment for each full year worked, those between 22 and 41 get 1 weeks’ pay for every year and anybody over 41 gets 1.5 weeks’ pay for each full year. The calculation is capped at 20 years of service and if you haven’t been at the company your whole working life then the redundancy money might be a paltry sum that just about keeps the wolves from the door for a couple of months.
Alternatively, you can negotiate the voluntary redundancy package, safe in the knowledge that up to £30,000 is free from income tax. Beyond the simple money, a lot of companies have policies in place to fund training schemes. So if you went into a company and gave up on your dream career, then maybe it’s the time to take a fresh look at your goals. With a financial cushion, the support of your current company and a number of government schemes to assist you in finding work, you could be amazed at the doors that redundancy opens.
With a generous package in the bank you could follow your dream of becoming a plumber, knowing that the two years of training won’t rip your finances to shreds. That’s a career that can come with a six-figure salary in the modern age and a number of trade careers offer far greater rewards than they did just a few years ago.
The balance of power and pay has shifted and there are a number of jobs, particularly creative ones, that have nosedived in terms of pure money and prestige. A shortage of plumbers, electricians and welders, meanwhile, mean that jobs you might have discounted 10 years ago are suddenly attractive options right now.
Alternatively, you might want to pocket the money and go straight into a similar job with another firm. Your bank account will be healthy, you’ll effectively get up to a year’s additional money for changing jobs and a good recruitment company will help you get set up with interviews before you have even walked out the door of your old company.
Voluntary redundancy could be one of the best moves you ever make, even though it is a brave step to take. So think about it if the voluntary redundancy letters come round the company. It could mean a new start and a monumental payday.