So You Got the Boot

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So You Got the Boot - Now What?

by Hayli Morrison

When a pink slip lands on your desk, it can be easy to view it as a one-way ticket to Disasterville. But for many, this experience is the catalyst for a very positive life change.

Such was the case for Marie and Sally (last names withheld by request). The two graphic designers found the upside in being laid off from their respective companies. Marie, who has been unemployed for only a couple weeks, is using the time to increase familiarity with new design programs and expand her design portfolio with pro bono work. Sally took time to strengthen existing business relationships and establish new contacts after her layoff last fall. Her networking paid off after four months, leading to a new job with better benefits and a more positive work environment.

“The job I eventually got with my current company basically fell into my lap,” Sally said. “I wasn't even seriously looking for a full-time position when it was offered to me.”

Such an easy transition may seem far-fetched, but it can happen for anyone. The most important factor is to take charge of the situation through a few key steps.

Establish the terms of your parting. Will you get a severance package? If so, what are the terms and conditions? Are you to leave work immediately or at day’s end? Could you get a letter of reference from your employer before departing? At this point, it’s usually too late to negotiate a way to stay with the company, but you will want to take your time in negotiating the best parting terms.

“Most people don’t get terminated by surprise – they see it coming,” said career coach Deborah Brown. “You just need to face it and negotiate the best severance package you can. You don’t have to sign anything in the moment – you can take time to think about it. At that point, you could talk to other people who were fired or laid off and find out what they got. That might give you negotiating power when you go back.”

Take care of your benefits. Health insurance is another important consideration, and federal law allows coverage to continue through a former employer for a certain period of time. Known as COBRA coverage, this option can be quite expensive; so many people view it as a last resort when no other options are available.

“COBRA will cover up to 18 months now, but it is very expensive – maybe five times what you’re expecting,” said Len Strazewski, who writes a column on employee benefits for Human Resource Executive magazine. “If you can get insurance any other way, you should. If you are young, you may want to purchase individual insurance. The odds are that an individual insurance plan with a high premium will be considerably more affordable than COBRA.”

Regarding 401k money, Strazewski advises that it be rolled over quickly into an IRA account. This gives the individual – not the corporation – administrative access to the money. This does not mean, however, that the fund should be cashed out. Doing so can result in a smaller retirement nest egg and hefty penalty fees for withdrawing the cash before retirement age.

“That’s the worst move you can make, not just for your future, but also from a financial perspective, because of the penalty,” Strazewski said.

File for unemployment. There’s no shame in drawing unemployment assistance. It’s there for a reason and you should use it. While you should negotiate the best severance package possible from your former employer, don’t be ashamed to make the call and line up unemployment assistance if needed. Sooner is better, as unemployment checks can take several weeks to start arriving. This can also help take some of the pressure off as you search for other jobs.

Be kind to yourself. After a tumultuous departure, it can be tempting to look negatively upon oneself and one’s qualifications. Take time to pursue hobbies and interests, travel and visit with friends or family, and even network and do pro bono work like Sally and Marie. This helps a professional stay current and relevant in their industry.

“There’s a tendency to isolate oneself. Don’t do it,” said Marie. “The support of your peers is extremely crucial during this time. Stay active in professional organizations.”

Doing so can mean the difference between letting a potentially negative experience get the best of you or making the most of it and turning it into the most constructive time of your life.