Losing your job

Step 1: Know your employment rights

If you lose your job, your rights will vary depending on whether you were made redundant or if you were dismissed. Redundancy is when your job no longer exists in a company. Dismissal is where you lose your job but your role still exists and you could be replaced by someone else. If you feel you have been dismissed unfairly, you should contact the Workplace Relations Commission.

If you have been made redundant, you may be entitled to a statutory redundancy payment. This is a minimum entitlement that your employer must pay if you meet the criteria. In order to qualify, you must be:

• working with your employer for at least two years
• over 16 years of age

The Workplace Relations Commission has more information on the statutory redundancy payment and how to apply. You can also use the Department of Employment Affairs and Social Protection’s handy redundancy calculator.

Your employer should provide you with the following if you lose your job:

• P45 – you need this to claim a tax refund and social welfare benefits if you are unemployed, or to avoid paying emergency tax if you start a new job.
• Notice period – your contract of employment will determine how much notice you are entitled to. However, a minimum notice period applies if you are working with your employer for 13 weeks or more.
• P60 – this is a tax certificate that provides a record of your PRSI payments that you will need to claim social welfare benefits. See Step 2.
• Form RP50 – this form is only used if you are being made redundant.

If you are asked to take a pay cut or work less hours, this requires a change in the terms and conditions of your employment contract. Both you and your employer must agree to this change. You can get more information on reduced hours or pay on the Citizens Information Board’s website.

Your pension may also be affected if you lose your job. This depends on whether you have an employer pension plan or a personal pension plan.

Step 2: What are my tax and social welfare entitlements?

When you are working as an employee, you will probably pay tax, Pay Related Social Insurance (PRSI) contributions and the Universal Social Charge (USC). If you lose your job and become unemployed, make sure you are getting all your tax relief benefits and social welfare entitlements.

Tax relief benefits

You may be entitled to a tax refund if you were employed and have lost your job. You can get information at mywelfare.ie.

Social welfare entitlements

You may be entitled to a payment called Jobseeker’s Benefit, if you have paid enough PRSI contributions. If not, you may be entitled to a means-tested payment called Jobseeker’s Allowance. If you are self-employed, you are generally not entitled to Jobseeker’s Benefit, but you may be assessed for Jobseeker’s Allowance. You can get more information at mywelfare.ie.

If you do not qualify for the above benefits and you are living on a low or no income, you may be entitled to a supplementary welfare allowance scheme which may include a basic payment, rent supplement, mortgage interest supplement, exceptional needs payment, back to school clothing and footwear allowance. Find out if you qualify at the Department of Employment Affairs and Social Protection’s website.

Step 3: Managing your money and dealing with debt

If you lose your job or if you are worried about your job security, managing your money can be really stressful. However, there are some steps you can follow to take control of your finances and help you cope with a reduced income.

• If you have a mortgage and are having trouble making your repayments, or you think you will soon be in difficulty, read our information on coping with mortgage arrears.
• Complete a financial health check. This will give you a clear picture of your current situation and will make it easier to identify where you need to make changes.
• Make a new budget. Remember, the most important thing is to be realistic. You need to make changes and cut back where possible.
• Cut back on smaller unnecessary luxuries and habits first. Check out our spending calculator which shows you how much you are spending on everyday items every month and every year.
• List your debts. Use our debt checklist to help you identify your priority and secondary debts. Your mortgage or rent is an example of a priority debt – if you do not make your repayments, you are at risk of losing your home. See our tackling debt section and the website keepingyourhome.ie, from the Citizens Information Board and Money and Budgeting Advice Service (MABS).
• Check if you have payment protection insurance cover to help you meet mortgage or loan repayments while you are out of work, and what you have to do to make a claim.
• Consider switching your utility bills to a budget account to help you spread out the cost.
• If you get a redundancy lump sum or redundancy pay, consider how you might budget to pay your bills.
• Be aware that missed payments can affect your credit history.

If you’re having difficulty meeting loan or mortgage repayments, contact your lender as soon as possible to explain your situation and to discuss your options. This may include debt consolidation, payment breaks or extending your loan.

If you have serious debt problems, you can contact your local MABS . They offer free, confidential and independent advice to people in serious debt.  For emotional or psychological support during a difficult financial period, you can contact the Samaritans at www.samaritans.org.

Step 4: Redundancy lump sums

If you are made redundant, you may receive a redundancy lump sum from your employer that you want to save or invest. You should consider contacting a financial advisor if you think you need help making a decision. We have lots of information on saving and investing, including comparing savings and investment options and understanding risk. The Central Bank’s Deposit Guarantee Scheme protects money on deposit – up to €100,000 – in financial institutions authorised by the Central Bank. Alternatively, you may wish to clear your debts with your lump sum if it means you will save more this way. Think about your goals, whether you need to adjust those following redundancy, and how your lump sum can fit in with them.

Beware of fraudulent offers

Always be wary of offers which seem too good to be true. Fraudsters are known to target employees of companies who are making staff redundant in an attempt to get them to part with their money. Never give money upfront to someone claiming to be a potential employer. Find out more about how scams.