Redundancy - What would you do?

ZingK

If you:

Have a mortgage.

Earn over 40k+ per annum in an IT job 25 mins drive from where you live.

Have been working for the company for 9 years. (Various positions but current one for quite a while, 5 years +)

Have a easy job, (easy because you are doing it so long but compared to some jobs the atmosphere is quite easy going also)

Are in Night college doing the 1st year of a business and IT degree because you feel you cant progress in this company without being more qualified.

Also are still unsure, that even after getting a degree, that you will move into a better role within the company, as colleagues in your position already have degrees.

Feel you have no respect from certain managers.

Would love to learn something new (not necessarily completely new but something different which will help you earn more money)

Have been advised there will be 200 voluntary redundancies within the company.

You think you may get 45k+ Euro which is not taxed.

But also have been advised by the union that your contract (after the last take over from previous company) has something in it like civil servants have in their contracts. So if likely redundancies were made in time, you would be safe in your job. Not everyone has this contract, only say less than 50% of the company.

And.... THE COUNTRY IS IN RECESSION.

Would you be crazy to take the money especially in times where people are being let go left right and centre?

Or is this a good opportunity for you to go and try something else?

Esel

Crazy to take the money.

Thumpette

Sit tight- those contract clauses dont come alont too often!

AARRRGH

You don't mention what age you are, or whether you are single or have children.

If you are single and you can sell your house for a profit, I would take the money and emigrate. (That's just what I would do, I am not saying you should do that.)

If you are married and have kids, I'd stay in the job.

stopper

Stay where you are - jobs are scarce and 2009 will be a tough year.

TripleAce

Making a rough calculation, considering that you get 40k gross/year (around 32k net I guess), in 2 years it would be very roughly 64k net.

If you take 45k net and sum 24 months dole (this is the worse case scenario whereby you cannot find another job for 2 years), it would be about 45k+20k dole, you would have the same amount and a lot of free time. This is just from a mathematical perspective - I would hate to go on the dole myself and would rather do some manual job instead.

I think this is a marginal situation, but I would take the 45k and look for a job elsewhere (considering that your current job also has some downsides ie. no respect from some managers, etc). - redundancy packages don't come along too often, and 45k is not easy money to save.

kmick

It is taxed - not all of it but I think it is after 10k
http://www.citizensinformation.ie/categories/employment/retirement/income-tax-in-retirement/retirement_lump_sum_taxation

* Basic Exemption: The basic exemption due is €10,160, plus €765 for each complete year of service. (This does not include statutory redundancy which is tax free.)
* The Basic Exemption plus the Increased Exemption: An additional €10,000 called the increased exemption is also available in the following certain circumstances;

1. If you haven't received a tax-free lump sum in the last 10 years

2. If you have never received a tax-free lump sum and you are not getting a lump sum superannuation payment

3. If you are in an occupational pension scheme, the increased exemption is reduced by any tax-free lump sum from the pension scheme you may be entitled to or, the present day value of any tax-free lump sum that may be payable in the future.

ZingK

I am 28 years old, single and have no kids.

As far as I am aware it is redundancy so its not taxed, this is what I have been advised.

Very inetersted in your opinions.

kmick

Id look for another job fast and then take the money.

brightspark

From personal experience I know that...

Statutory Redundancy isn't taxed (that's the 2 weeks per annum + 1 week at a maximum of 600 Euro per week).

But any non-statutory redundancy payment will be taxed; there are some allowances, as kmick stated (at least 3 different types) and you do get to choose the most advantages allowance method, these are difficult to calculate if you're not familiar with them so I urge you to get competent advice.

(after working for more than 15yrs with a company I ended up paying more tax on my non-statutory payment of 5weeks per year than I got in statutory redundancy!)

Don't forget some of the tax paid on the redundancy will probably be at the higher rate.

Also you may not get any social welfare for up to 9 weeks (I was fortunate enough to get another job so it didn't affect me)

Raul

I think you should test the water and see what's out there before looking for redundancy. In boom years, January was typically one of the busier times for recruitment so keep an eye out for potential positions of interest and submit your CV for suitable ones. If you can't find a suitable job before the redundancy deadline, then I would stay put. I definitely wouldn't take a chance and leave without a job lined up especially considering you probably have a large mortgage (making this assumption based on your age and the fact you are single so probably paying it off on your own).

Good luck with whatever you decide to do!

michael_23

Howdy, I reckon you should hold onto your job until you know exactly what the "Try something different is". Make a plan, no point in leaving a good job to float aimlessly with pockets full of cash!

just a query, what exactly so you do in IT?

Longerview

ZingK,you may not get tax relief on your mortgage if you are not paying tax next year..that could alter your calculations ,better ask the bank what the position on this one is !

Darragh29

ZingK wrote: »

I am 28 years old, single and have no kids.

As far as I am aware it is redundancy so its not taxed, this is what I have been advised.

Very inetersted in your opinions.

ching ching, GONE!!! I had this same situation put to me and took it and have never looked back. Work for myself now, no ars*hole managers treating me like sh*te, no contending with jobs for the boys and all that rubbish and being passed over for promotion because management wanted to promote their unqualified and incapable golden boy.

OP, if you are unhappy, leave, that's my advice. I know so many people who are stuck in dead end jobs with golden handcuffs on them, afraid to take a chance on themselves for fear that they might suceed at something...

CiaranC

28, single with 45 grand in your pocket?

Why are you even talking about this. You could travel the world for 2 years on that budget. I know what Id do.

ZingK

Any more views on this? I am totally undecided.

TripleAce

ZingK wrote: »

Any more views on this? I am totally undecided.

Take the money!

mikemac

Take the money
Travel the world and live like a king!
When you come back and if you can't find a job you can do your college course full-time

niceirishfella

How about take the money, but travel the world working in IT. Then you keep your cash and see new horizons.

homeOwner

I would take the redundancy. Its not easy to save that amount of money and with no responsibilities (except a mortage) you have a great oppertunity to travel or maybe start up a new business, or go back to college and study something new.

Your redunancy payment will be taxed so you wont get 45K into your hand but you'll still end up with enough money to not work for at least a year. Most likely you will never get that chance in life again.

If you want to stay with the same career, it wont effect it, seriously, it wont. I wouldnt even worry about that. You have youth on your side anyway.

Good luck. I'm jealous.:P

Bluetonic

If it's taken early in the year and you subsequentially travel (or don't work/earn) for the rest of the year you will be able to get the majority of the tax back at the end of the year.

AARRRGH

CiaranC wrote: »

28, single with 45 grand in your pocket?

Why are you even talking about this. You could travel the world for 2 years on that budget. I know what Id do.

You could travel the world for three years! Easily!

28, single... I'd be gone in a flash.

SheroN

If I were you, I'd take the money and run.

eth0_

Take the money and go travelling. You might never have the opportunity again in your life.
You can always do some temp/contract work if you settle in a place for a couple of months so you don't come home skint.

jimmycrackcorm

Take the money. You will get another job and have plenty of money and have a nice break in the mean time.

Thoie

Sorry to be the voice of gloom, but I was made redundant last year (there was no volunteering). Didn't get as much cash as you're calculating, and it took around 10 months to find a new job.

Some people have always dreamed of heading off travelling with cash in their pockets, but consider if it's actually for you - would you miss your mates, do you get chatting to people easily, do you actually have any interest in seeing other parts of the world for more than a two week holiday?

If travelling isn't for you, I think the advice of trying to line up another job is quite good - just don't shoot yourself in the foot and miss out on the redundancy. If possible try and organise to be starting the new job about a month after the old - that'll give you time to start forgetting the negative feelings about old bosses, maybe go on a holiday.

Talk this over with everyone you know (that isn't working with you ) and get their opinions on what's right for you, not what their dreams are. And stick most of the cash in a high interest notice account until your plans are firmed up. Keep some to cover the mortgage, bills and a nice holiday/treat/whatever, but put the rest of it away

BostonB

eth0_ wrote: »

Take the money and go travelling. You might never have the opportunity again in your life.
You can always do some temp/contract work if you settle in a place for a couple of months so you don't come home skint.

I go along with this. That said I expect it to be very hard to find work in Ireland for the nexty couple of years. So don't expect to walk back into a job, temp or otherwise when you come back. But you probably unlikely to have this opportunity again.

Serafijn

Firstly check the actual amount you would get, as one other poster mentioned it might not be as much as you expect. Talk to your HR or payroll department for help with this.

If it were me and I was getting upward of say, 30k, I'd move to another country and set up my own business there.

You're never going to have this kind of cash upfront again, so if you have any inkling of setting up shop then do it now, while you can afford to not earn anything while it gets going!

partyguinness

I would see it as a golden opportunity to take time out..you have been working 9 years so a break would do you good..go travelling for a year..rent out the house..go back to college full-time..explore new avenues...opportunities like this dont come around too often..

Say you stay put and in, say, 5 years you are married with kids..then you may regret not having taken the chance to travell etc..if thats something that interests you...

Bluefoam

work will be tough to find, if you have a job - keep it.

Homer J Simpson

Hi Op,

My situation was very similar to yours 2 years ago, the only exception being mine wasnt voluntary redundancy. I received 40k in redundancy payment.

I was the same age as you, single and had just bought my own house. I used the redundancy money to clear my car loan and the remainder was used to pay a lump sum off my mortgage.

Foolishly I thought I would walk into a job straight away as I had many years experience in the IT & Telecoms sector. I was on the dole for 3 months( unbelieveably soul destroying) then ended up working on various building sites for 4 months (Without doubt the hardest work I ever did). I finally got back into the telecoms industry as a telecoms technician. Compared to what I was doing in the job I was made redundant from this would be considered a complete demotion.

Although I was single and could have rented out my house and gone travelling, I had already done this a few years ago but realised I was a homebird and returned after 6 months. Heading off travelling can seem very appealing but how it turns out for you depends upon the type of character you are. Living in hostels, watching what you spend each day can get tiresome after a while.

Have you any dreams at the moment which you would like to pursue? Perhaps start your own company or change career altogether and return to college to train?

I currently am in a company which many people would give their left arm to work for on reputation alone. It is a false image portrayed to the public however. Last Summer I sent a PM to another user on here named Wibbs and his advice to me was if I'm single, have no kids etc etc then now is the time to take risks and go for what you want in life. I totally agree with him. For the last 6 months I have been looking for work elsewhere but nothing has been fruitful to date.

My advice to you is dont be fooled into thinking you'll walk into a job straight away once you've been made redundant....there's a chance it may happen but a very slim one at that. 40k wont take you very far when you've no income and have a mortgage to pay, car loans, electricity, gas etc etc.

Feel free to PM me regarding this........ at the end of the day go with what your heart says.

Best of luck

SheroN

I would say you know deep down what is best for you. No one here really knows your situation or what kind of character you are, so it's hard for anyone to tell you what to do.


If I were in your situation, I would take the money. You're unlikely to have a lump of cash like that again in your life. Yes - it's a gamble, but I think it's one worth taking.

Don't be fool hardy with your thinking. But at the same time, don't be a slave to fear.

Bluetonic

SheroN wrote: »

I would say you know deep down what is best for you. No one here really knows your situation or what kind of character you are, so it's hard for anyone to tell you what to do.

Good advice.

SheroN wrote: »

You're unlikely to have a lump of cash like that again in your life.

Bonuses to that amount are not too unusual in life depending on your job. A lot of people also inherit amounts far in excess of this later in life.

CiaranC

Later in life, great. He could be hit by a bus tomorrow. Life is for living. He wont be 28 "later in life".

SheroN

Bluetonic wrote: »

Bonuses to that amount are not too unusual in life depending on your job. A lot of people also inherit amounts far in excess of this later in life.

I don't think we have enough detail about the OPs situation to say this. It's something for him to look at when making a decision. OP - How likely are you to have a lump sum like thisagain?

Bluetonic

CiaranC wrote: »

Later in life, great. He could be hit by a bus tomorrow. Life is for living. He wont be 28 "later in life".

If that was the logic people live their lives by then nothing would be ever planned as you could drop dead in the next second.

Realistically the OP probably won't.

cornbb

OP, it sounds to me like you have been working pretty hard since you left school and you now have a fairly decent salary and a decent amount of experience for someone in their 20s. IT hasn't been as hit as hard by the recession as other areas, although that scenario could be very different a year from now. You are young, unburdened by a family and you have a huge lump of cash in your pocket. You will be fairly employable, relatively speaking, at the end of it all. I'd take the money and have a good time for now with it if I were you...

Yesterday I found out I will be made redundant at the end of the month - not voluntary I'm afraid - so I'm wondering what to do myself now...

ZingK

To answer some of your questions:

I don't think I am likely to inherit a lump sum like this, maybe when I'm 60 or something but definitely not in the nearish future unless something unusual happens.

It isn't really that much cash IMO and I would deffo be looking to work almost immediately, if that's a one year working holiday in Auz or another job in Ireland but I wouldn't be really hoping to live off the cash and do nothing for a year.

Yeah Id love to own my own business, have not decided in what exactly yet, its something I will definitely look at in the future. I have ambition and want to keep doing better.

Most people who I work with, the majority, say that taking the money would be crazy, that 2009 is going to be a very hard year for everyone and we should count ourselves lucky to be in a job. For the qualifications I have on paper, its a good enough job, its just I have been doing it for so long that basically I am pissed off with it.

Someone said to me, because we have had it so good with the celtic tiger, we don’t understand what hard times are, back in their day they did their job and were glad to earn a wage. Maybe they are right?

I honestly do not know what is the correct decision, I have a couple of months to decide, I really am interested in all your views and appreciate all the responses and advice.

Eoin

ZingK wrote:

Someone said to me, because we have had it so good with the celtic tiger, we don’t understand what hard times are, back in their day they did their job and were glad to earn a wage. Maybe they are right?

Most people who worked in IT at the beginning of the decade went through the dotcom crash, and know what it's like to have shag all job security and wonder when they'll turn up to work to find the doors padlocked. For people not in IT, this probably only affected their investment portfolios, so they probably have no idea what a really shìt time it was for lots of people.

Anyway, I'd usually say stick with the job, but with that sort of cash you will have a pretty decent cushion for a good while, especially if you can arrange an interest-only mortgage in the meantime. It's a tough call.

Number one

28, single, 45k. What are you waiting for , this is a sign from God telling you to expand your horizons enjoy life and escape the humdrums of 9-5 that you're going to be stuck in for the rest of your life. Plus your managers show you no respect so why do you think that will change?

Take the money and run, it gives you 16 months+ of pay equal to what you would have been getting working and as an earlier poster said if you add dole money to that its way more. thats if your prepared to do that.

What if you keep the job and the company goes belly up in a year or two? You'll be out of work and with no redundancy package. Imagine the feeling of bitterness.

anonymousjunkie

eoin wrote: »

Most people who worked in IT at the beginning of the decade went through the dotcom crash, and know what it's like to have shag all job security and wonder when they'll turn up to work to find the doors padlocked. For people not in IT, this probably only affected their investment portfolios, so they probably have no idea what a really shìt time it was for lots of people.

Anyway, I'd usually say stick with the job, but with that sort of cash you will have a pretty decent cushion for a good while, especially if you can arrange an interest-only mortgage in the meantime. It's a tough call.

Zactly, I had a nightmare of a time starting out in IT during that period. They were bad aul times, hit with redundancy 3 times in a row, 2 out of the 3 were startups and stuck on the dole for various lengths of time, the longest being 9 months. Personally would take job over lump sum myself at the moment, but thats cause I've been jobless and know what it can be like.

Esel

ZingK wrote: »

Most people who I work with, the majority, say that taking the money would be crazy, that 2009 is going to be a very hard year for everyone and we should count ourselves lucky to be in a job.

This recession will not end in 2010, or 2011 either imo. 1989 was the fall of communism; 2009 might well be the fall of capitalism (as we know it). Governments are printing money, interest rates will fall to zero. Unless you have a tracker mortgage, you won't see anything near zero interest rate though.

I replied early in this thread to say that you'd be crazy to take the money. You may be pissed off in the job, but if this scenario had not arisen would you have been seriously considering changing employer? It's all very well for random people here advising you to take the deal, but imo they are not factoring the recession (possibly impending depression) into the equation, or the fact that you have a mortgage to pay, or the fact that you may find it very difficult to get another similarly-paid job.

Anyway, you have to make up your own mind. Go with your gut feeling, and best of luck with whatever you decide.

m83

esel wrote: »

This recession will not end in 2010, or 2011 either imo. 1989 was the fall of communism; 2009 might well be the fall of capitalism (as we know it). Governments are printing money, interest rates will fall to zero. Unless you have a tracker mortgage, you won't see anything near zero interest rate though.

I replied early in this thread to say that you'd be crazy to take the money. You may be pissed off in the job, but if this scenario had not arisen would you have been seriously considering changing employer? It's all very well for random people here advising you to take the deal, but imo they are not factoring the recession (possibly impending depression) into the equation, or the fact that you have a mortgage to pay, or the fact that you may find it very difficult to get another similarly-paid job.

Anyway, you have to make up your own mind. Go with your gut feeling, and best of luck with whatever you decide.

I'd love to hear more about the above.


OP, you only live once. Feck the recession, get out of the country, travel and have the best time of your life.

Gone West

esel wrote: »

Crazy to take the money.

I´d say that you would be crazy to not take the money and run.
To some, 40k and 25 mins commute might sound desirable.
But to others, the prospect of a once off payment of 45k, ditch the mortgage, sell your car and posessions, and move to a nice country.
Move somewhere, where 45k will buy you a bar on a beach, and where you do not have to slave in a job you obviously do not love, with people you obviously do not like, being made to feel inferior because you don´t have a piece of paper.

What sort of world are we living in, really?
I quit my job like this a short while ago (early 20s, 48k pa, IT multinational, very secure, etc). And I do not regret it one iota.
Mad to leave? Hardly, go live your life and don't tie yourself down any more than you already have. 45k will bring you many years of living in luxury in most of the world. Go enjoy it, rather than being made to be a fool in an obviously sh1tty working environment.

Esel

FuzzyLogic wrote: »

45k will bring you many years of living in luxury in most of the world.

Most of your world, maybe!

bringitdown

Faced the same situation myself with the dot-com era crash.

I managed to get a job after redundancy but after three months quit it and went around zee world. Best decision I ever made.

You don't have to use up all of your money either, put a decent amount 'away' and take maybe 10 to 20k on the road with you ... plenty for a year on a budget ... also plenty of opportunities for travelers - TEFL in Korea, Japan, South America, casual labour in Oz,NZ etc. etc. in case you feel the need to earn a bit while on the road.

Gone West

esel wrote: »

Most of your world, maybe!

My world is half a degree from the equator, palm trees, warm south pacific ocean, rain twice a year, sunny year round, and 20$ USD per day is more than enough for a high "western" standard of living.

And most Irish people can live this lifestyle if they just drop it all and leave

ZingK

FuzzyLogic wrote: »

My world is half a degree from the equator, palm trees, warm south pacific ocean, rain twice a year, sunny year round, and 20$ USD per day is more than enough for a high "western" standard of living.

And most Irish people can live this lifestyle if they just drop it all and leave

Sounds good to me!

niceirishfella

FuzzyLogic wrote: »

My world is half a degree from the equator, palm trees, warm south pacific ocean, rain twice a year, sunny year round, and 20$ USD per day is more than enough for a high "western" standard of living.:)

wow - does sound tempting:)


*As NIF looks out the window at the cold wet n'crappy sunday afternoon*

derden

Fuzzylogic where are you living? , any jobs going?:)