Protecting yourself and your financial well-being is important if you’ve recently been laid off. Here are some steps you should consider taking.
Steps to take after being part of a layoff
1. Review your health insurance coverage
If you received health insurance through your job, you might be able to continue your coverage through COBRA as a laid-off employee. COBRA, an unemployment insurance benefit, is a federal law that allows you to continue your employer-sponsored health insurance for a limited time after you lose your job. You’ll have to pay the full premium yourself, but it can be a good option if you don’t have any other coverage.
2. Check your severance package
If you received a severance package from your former employer at the termination of employment, carefully review the terms and conditions to understand what benefits you are entitled to. This may include health insurance, unemployment benefits, or outplacement services.
3. File for unemployment benefits
If you’re eligible, file for unemployment benefits as soon as possible. Unemployment benefits can provide temporary income while you look for a new employer.
4. Create a budget
It’s important to manage your expenses while looking for reemployment carefully or if you want to take time off. Create a budget to help you understand how much money you have coming in and going out, and make any necessary adjustments to reduce your expenses.
5. Update your resume and start job searching
Take the time to update your resume on LinkedIn and start looking for a new job. Consider contacting your professional network and utilizing online job boards and career resources.
What does it mean to be laid off?
Being laid off means that an employee is no longer employed by the company, usually due to financial reasons such as the company experiencing financial declines, downsizing, or restructuring. If you are laid off, you’re typically not at fault for terminating employment. You may be entitled to unemployment benefits, depending on the laws in your jurisdiction and the circumstances of your layoff. It is important to note that being a laid-off worker differs from being fired, which means an employee is terminated for cause, such as poor performance or misconduct.
What’s the difference between being laid off, furloughed, and fired?
Being laid off, furloughed, and fired are different circumstances when you lose your job. Here’s how they differ:
- Laid off: Losing your job due to a layoff usually means that the company is downsizing or restructuring and has eliminated your position. Layoffs can be temporary or permanent and may affect one person or a group of co-workers.
- Furloughed: When furloughed, your employer temporarily reduces or suspends your work hours or pay. Furloughs are often implemented as a cost-cutting measure when a company faces financial challenges. Furloughed employees may be eligible for unemployment benefits.
- Fired: Being fired means being terminated for a specific reason, such as poor performance, violation of company policies, or misconduct. Being fired is usually considered a permanent separation from the company.
Understanding these circumstances’ differences is important, as they can have different implications for your benefits and unemployment eligibility, such as healthcare. If you have any questions about your job loss, it’s a good idea to speak with a human resources representative or contact the U.S. Department of Labor.
What is unemployment insurance?
Unemployment insurance (UI) is a government-funded program that provides temporary financial assistance to workers who have lost their jobs through no fault. UI helps workers bridge the gap between jobs by providing a weekly benefit to help cover their basic living expenses while looking for new employment.
How do I claim unemployment after being laid off?
If you have been laid off and seek unemployment benefits, you must file a claim with your state’s unemployment insurance agency. If you are approved for unemployment benefits, you will receive a notice explaining how much you are eligible to receive and how to access your benefits. If your claim is denied, you may have the option to appeal the decision. It’s a good idea to carefully review the terms and conditions of your state’s unemployment insurance program and follow all instructions provided by the agency.
Will I receive severance pay when I have been laid off?
Whether or not you will receive severance pay when you are laid off depends on the terms of your employment and your employer’s policies. Some employers offer severance packages to workers who are laid off as a way to provide financial support during the transition to a new job. Severance packages can vary widely and may include a variety of benefits, such as a lump sum payment, a continuation of health insurance coverage, outplacement services, and unemployment benefits for a certain length of time. Severance pay is usually based on the length of your employment and your position within the company.
Are there laid-off benefits?
Meet the eligibility requirements of your state’s unemployment insurance program. You may be able to receive temporary financial assistance to help cover your basic living expenses while you are looking for a new job. It’s important to carefully review the terms of any benefits your employer offers and understand your options.
Small business layoffs
If you are a small business owner facing the decision to lay off employees or an employee who has been laid off from a small business, it can be a difficult and stressful situation. Here are a few pieces of advice for dealing with small business layoffs:
For small business owners:
- Communicate openly and honestly with your employees: It’s essential to be transparent and upfront about the reasons for the layoffs and the steps you are taking to address the situation.
- For employees who have been laid off:
- Review your options: Take the time to review your options and understand what benefits you may be entitled to, such as unemployment benefits or continuation of health insurance coverage, and see the possibilities for a rehire.
Common Reasons For a Mass Layoff
There are several common reasons for a mass layoff, defined as a significant reduction in the workforce at a company or organization. Here are a few potential reasons for a mass layoff:
- Recessions: Economic downturns or recessions can lead to decreased demand for a company’s products or services, resulting in a mass layoff.
- Pandemics: A global health crisis, such as the COVID-19 pandemic, can lead to a mass layoff due to decreased demand, supply chain disruptions, and other economic factors.
- Redundancy: When a company introduces new technologies or processes that make specific jobs obsolete, it may result in a mass layoff of workers whose positions have become redundant.
- Mergers: When two companies merge, certain positions may overlap, leading to a mass layoff of employees.
- Downsizing: Companies may engage in downsizing, which is the process of reducing the size of the workforce to cut costs or improve efficiency.
- Restructuring: Companies may undergo restructuring, which involves making significant changes to how the company is organized to improve performance or respond to changing market conditions. This can result in a workforce reduction of employees.
- Company closing: In some cases, a company may decide to close its doors permanently, resulting in the permanent termination of all employees.