Blog post

Redundancy Package VS New Job?

The arrival of the Corona Virus has had an absolutely devastating impact to the UK economy but slowly and surely we are starting to open our doors again and build our businesses back up.  Unfortunately for some this was impossible and from that we have sadly seen a number of businesses close their doors.

Regrettably we have seen this happen to a number of employers in the Scottish Borders, and as we know, with business closures and restructuring comes job losses and redundancies.  As the Scottish Borders already has limited work opportunities, this is a very worrying concern.

I read an interesting article today about the pro’s and con’s of redundancies and one of the points was of particular interest:

“If a large department is being reduced, there will be significant competition for similar jobs in other fields, which means scoring a job at the salary you want where you already live will be more challenging.”

This made me think about a large number of employees with a various employers in the Scottish Borders of whom are going through a similar challenge.  What we have found, talking to some of these workers is that they are waiting out their redundancy period so that they can collect their payment at the end in the hopes that they can use this money for something worthwhile i.e. a car, a holiday, towards a mortgage, a deposit for a house or even towards their wedding.

A concern that we have is that some of these employees have not been encouraged to look at the bigger picture, which is that there are other excellent opportunities available, offering higher salaries and further development and who are looking for employees to start now.

Let’s play devils advocate.  What if Mrs A decides to stay for the remainder of her redundancy period which is December 2020.  The date comes round, Mrs A collects her £5000 redundancy.  Christmas is expensive so Mrs A budgets some of this money for the festive period.  January comes round and Mrs A starts looking for employment, nothing available.  Mrs A now has to use some of her redundancy to pay her monthly bills.  This happens for at least 3-4 months because employment is at it’s lowest in the first quarter of each year.  By the time Mrs A successfully secures a role, it may not be what she wants and is a lower salary to her previous role.  By the time Mrs A starts her new employment, the likelihood is that most of that redundancy pay has gone on bills and living costs.

Moira and I went through a similar situation when we were made redundant in 2017.  Fortunately we had already set up Balfour Wilson Recruitment but all of our redundancy payment was spent paying our bills until we started making a profit with the business.  We did not get to enjoy any of our redundancy.

We implore anyone that is going through a redundancy process to consider whether the risk is worth it and if anyone would like to talk to myself or Moira about this or ask our advice, please feel free to call us on 01750 505 035 or email us at candidate@balfourwilson.co.uk