Retrenchment Payments

[sash]

I was talking to a colleague of mine and he said he had been retrenched in Sept. 2008. I felt very sorry for him as his partner also was retrenched in Dec. 2008.

Well story has a happy ending...the company he works for is known for generous severances...he told me he walked away with almost 100k after working there for 11 years!

Another friend got the Axe from Telstra...he had been there less than 3mths and he walked away with 20k.

I am noticing a pattern here....are companies usually this generous??

 

[boomtown]

Depends. I know people working for govt owned corporations just hanging around desperate to be made redundant because they know they can walk with big coin and get a job tomorrow in the private sector.

 

[devo76]

I work for a aviation company and have done for the last 14 years. I have been with them through the hard times and the good but what the next few years holds i dont know. I have over 8 months of leave/long service owing. The aviation industry is so cut throat in most areas now that im sure in the event of a retrenchment i will be lucky to see my entitlements let alone any retrenchment funds.Lucky im paid well. I have many friends in government/defence employment and it suprises me just how much they take for granted. Bonuses here,bonuses there,rent subsidy,cash for this,cash for that. Moving costs paid,reduced mortgage interest rates for some etc etc.I may be paid a LITTLE more but the security they have makes up for it.

 

[The Y-man]

I discovered the company I work for is extremely generous, after seeing packages people in other companies get..... 4 weeks per year of service if you are salaried, or 5 weeks per year of service + all accrued sick leave if you are a weekly wage earner.

Cheers,

The Y-man

 

[marg4000]

Sash, make sure your colleague has an accountant prepare his tax return this time around.

Retrenchment payments are treated differently and even more generously if it has been on the basis of a "genuine redundancy".

Hubby had a health problem in 1997 and after a long, drawn out battle with the company he worked for including legal action (brief - because of the outrageous costs - but effective) they eventually agreed to a payout. Actually they caved in before we did - our deadline to walk away and get on with life was the December (1999) but they conceded in the September.

We sought professional advice before settling, and hubby had the wording of the payout listed as "genuine redundancy". This meant that on a payout of around $120K we paid less than $10K in tax instead of the full rates.
Marg

 

[sash]

My friend has already got genuine redundancy...he only worked 3 months of this year so he will also claw back via marginal rate of tax.

We sought professional advice before settling, and hubby had the wording of the payout listed as "genuine redundancy". This meant that on a payout of around $120K we paid less than $10K in tax instead of the full rates.
Marg

 

[marg4000]

That's great Sash, the concessional taxation is really worthwhile.

BTW, it took a while but hubby went on to bigger and better things.
Marg

 

[Chris.R_WA]

My mate just got made redundant from a financial services company, and the severance worked out to be the equivalent of 7 months salary.

He had been with them for about 2 years. He has low debts, but I think it may take a while to find a new employer.

Scary stuff I reckon...no matter how much they pay you

Chris

 

[sash]

Wow...that is whopper...I agree that it will take time to find another employer in financial services.

Yes, scary stuff....so far so good where I am at...

My mate just got made redundant from a financial services company, and the severance worked out to be the equivalent of 7 months salary.

He had been with them for about 2 years. He has low debts, but I think it may take a while to find a new employer.

Scary stuff I reckon...no matter how much they pay you

Chris

 

[Nathan]

i think my glory is coming to an end, next few weeks should reveal all around my neck of the woods.

at present im thinking of plan b for income (job wise) im thinking of totally different career options (government job yells out to me at present) however what ever my decision is i know i will not be an employee earning my wage again from any other business out there.

oh well, i belive ive got cashflow to a level i can do with a standard avg wage job as long as i can find one in time...

 

[devo76]

Job security is on many peoples minds at the moment.Although i am in the private sector my primary roll is on a defence contract with 2.5 years to run. This has given me some safety in that i should have my PPOR paid off in that time.My plan is to do this plus build on my savings account. I have been through contract changes a few times and i always reduce debt and spruce up the resume. I will be doing the same this time but the question is will defence even renue the contract. Who knows. So for now i am preparing my own retrenchment benefites.

 

[nhb74]

I work for a mining company that is now part chinese The redundancy packages people have been getting the last few months are incredible to say the least. But then again it is the best company I have ever worked for compared to companies such as Telstra, Lucent, Siemens, Avaya

 

[Ms Jade]

i think my glory is coming to an end, next few weeks should reveal all around my neck of the woods.

at present im thinking of plan b for income (job wise) im thinking of totally different career options (government job yells out to me at present) however what ever my decision is i know i will not be an employee earning my wage again from any other business out there.

oh well, i belive ive got cashflow to a level i can do with a standard avg wage job as long as i can find one in time...

Sorry to hear that, Nathan. My BIL started working for an exec search firm about 6 mths ago & advised all of us that the best time to get your resume together is before you need to. As you probably know, many good jobs aren't publicly advertised. If I was even slightly concerned about my employment over the next 12 mths I would find a good recruitment firm and give them my resume. If you're interested in the public sector find out what firms the gov't uses in your area. BTW, I wouldn't assume that you won't be on as good a wicket somewhere else; you never know what opportunities are out there. There's always someone making money!

 

[asdf]

The redundancy packages people have been getting the last few months are incredible to say the least.

You will need it. Not fun to be unemployed at the moment especially if you've been retrenced from finance or mining. Will be a long time before things pickup. Head count freeze will be with us for years to come. Theres plenty of jobs around though but wants to go from earning $150k + bonuses to $30k serving fries at Maccas? That includes overtime!

 

[vbplease]

Another friend got the Axe from Telstra...he had been there less than 3mths and he walked away with 20k.

You gotta be kidding? why would a company pay out 20k to someone still in their 3month probation period

At the other end of the scale, the company I work for payed out 2weeks pay with about 3hrs notice to some skilled workers here.. after having worked a lot more than 3months with the company..

 

[santaslayer]

My company pays an extra percentage if you decide to leave straight away upon being notified of your redundancy. Otherwise you can hang around for 4 weeks getting internal counselling and upskilling.

 

[natecv8]

Just this week I've been informed that my contract w/ 10 months to run is being terminated due to "budget issues". I'm only slightly pissed off because they offered me a 12 month contract over Christmas and had me thinking that I wouldn't need to be looking, plus I have a very good relationship with my employer and am knee deep in things that I know they don't want to have to hand on to someone else or put a stop to.

Anyway, the search is on but I agree with many others that it's awful out there. Unfortunately I'm caught with my pants down a little because as a contractor I don't get a cent when I go, so even a maccas job would be an improvement

My tip: be alert but not alarmed! haha. I am not losing sleep but I won't be taking anything employment-related for granted again. Good luck, folks.

 

[sash]

Well if you are on 140K that is only two months pay...

Also, companies do not want to burn bridges or get press articles about them...this is good insurance.

The company you worked for is very old school....it may work against them when times are better as word get around...

You gotta be kidding? why would a company pay out 20k to someone still in their 3month probation period

At the other end of the scale, the company I work for payed out 2weeks pay with about 3hrs notice to some skilled workers here.. after having worked a lot more than 3months with the company..

 

[sash]

Sorry to hear that....but gathering from your posts you are quire young and have come a long way. It will be a bugger in terms of expanding your portfolio...

Good to have a plan B....my plan B was hatched last year via flicking one non-performing property, restructuring my portfolio, and getting into share options trading. The first two went to plan and have landed me a nice average salary (55-60k per year)...but the last one was did not go so well. I am down about 10k in shares but have have plan to break even by April 2009 and profit at a rate of 3-4k per month from May onwards (fingers crossed market does not drop another 20%). I need to have about 36k pa to live comfortably......

I suggest you organise a line of credit to ride things through now and try to keep the lending across lenders. I am sure you will be alright. Also, as your fixed rates come off highs over the next year or so...hopefully you can still fix in between 6 and 7%.

All the best.

i think my glory is coming to an end, next few weeks should reveal all around my neck of the woods.

at present im thinking of plan b for income (job wise) im thinking of totally different career options (government job yells out to me at present) however what ever my decision is i know i will not be an employee earning my wage again from any other business out there.

oh well, i belive ive got cashflow to a level i can do with a standard avg wage job as long as i can find one in time...

 

[BenQld]

I work for a mining company that is now part chinese The redundancy packages people have been getting the last few months are incredible to say the least. But then again it is the best company I have ever worked for compared to companies such as Telstra, Lucent, Siemens, Avaya

I was made redundant just last week by that company, and the payouts were exceptional. I had only been there 3-4 months, and ended up with a payout that was close to 7 months of my after tax income due to the generous tax rates applied to redundancies. And I am still owed a bonus payment sometime in March !

If I get another job soon, all that cash will just pay down a huge chunk of my PPOR.

Ben