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Thoughts on voluntary redundancy?(8 Posts)
The company I work for have been hit very hard by the coronavirus outbreak and have just announced a voluntary redundancy scheme. They are offering extremely generous terms, and if I was accepted I would receive quite a substantial payout. However, I would need to make a decision and start the application process quite quickly.
I was genuinely already looking to leave, for several reasons, but obviously I would much prefer to take my time to find the right role and have something confirmed before handing my notice in. I have now started looking but it's unlikely I'll be able to get an offer sorted before the deadline. This isn't something I've been through before and I'm also concerned about how it may look to any future employers.
Does anyone have any experiences (good or bad!) that they would be willing to share?
I haven't personally taken VR but work in HR and administer VR schemes a lot. It's always a tricky one because you've got to weigh up the size of the payout with the time you think it will take you to find another role and obviously with the current uncertainty in the economy it's hard to know what that looks like right now. In terms of how it looks to future employers, I think you will be fine so long as you don't end up with a very long gap in employment on your CV - or if you do you have a good reason for that e.g. you took the opportunity to have a career break to study/spend time with family/travel (ha, not at the moment!) etc.
Some employers are I guess automatically suspicious of someone who has been made redundant (voluntary or compulsory) in case it was their previous employer using redundancy to get rid of them due to under-performance or bad conduct or something, but this is more the case in boom economic times or in industries/roles where redundancy would be uncommon due to high demand. I think there will unfortunately be a lot of people who lose their jobs due to COVID in the next few years so I doubt that will apply. And if you can get a good personal reference from your employer as part of the 'deal' (i.e. one actually stating your personal qualities and performance etc not the bland HR template setting out dates, that would be great. But some employers won't give these any more). I don't think it being a voluntary redundancy makes too much difference compared to a compulsory personally, although maybe others would disagree?
Overall if on comparison of the compensation you are being offered offset against your 'realistic worst case' scenario of how long you will be unemployed for still stacks up well then makes sense to go for it. Also, how likely do you think it is that if you don't take this deal you will end up being made compulsorily redundant anyway, and how do the compulsory/contractual terms compare to what you'd get then, as that is another valid consideration? If for instance you are being offered a year's salary to leave now, if you don't take it you'd be highly likely to be redundant within 6 months and would only get a month's salary then, seems to make sense to take it?
Hoping you will see this - @mandyg27 and @maxelly - I am trying to find what VR terms have been for people? Like a month's pay per year service etc, was there any kind of formula? What about benefits lost, were those taken into account? Thank you x
Terms vary a lot, I suspect, but the deal where I've been before was 1 month per year's service (capped around 20 years) and I got the impression that was quite generous. Others may have more reference points than I do.
Seems like a bit of a no-brainer for people with extensive service under those kinds of terms.
I took VR three years ago, for a six month payout with six year’s service. I had been unhappy for a long time and although it was a difficult decision I’m glad I did it as could conceivably see myself having left without VR at a later date. I did get a new job before my leave date, so think I’d have been less keen if there wasn’t a strong job market (moved to civil service - reslilient to coronavirus). I took a month off between jobs, which was lovely.
Given covid, I think most recruiters wouldn’t question someone having taken VR, or having breaks.
In your position I'd weight up VR v CR and how you'd manage.
Now depending on the level of VR, how ING you could survive on this and your ohs income etc I'd suggest of the company has been this badly hit then likelihood is CR on less enhanced terms will follow....
Me, if the redundancy gave me 6 months salary plus and ohs role is relatively secure, I'd proceed.
Even if a lone parent, with 6 months plus I'd go for it too as worst case scenario after 3 months youd then be able to claim benefits as an emergency fall back.
My company's scheme opened today. My expression of interest was with my Head of Department yesterday.
I love my job but .... the writing's on the wall due to this damned virus. I can either walk with a decent settlement or get pushed later with less than sod all.
Keeping my fingers crossed that it's approved
I took VR 3 years ago, I had been waiting for it to come up as I hated my job and had 10 years’ service. I was entitled to 12 weeks’ notice which I had to work and 3.5 weeks’ pay (tax free) for each year of service so 35 weeks’ pay tax free. The redundancy payment was £20k and I walked straight into a new job so got a new kitchen!