Expats, what steps can you take if you’re made redundant?
Along with a reasonable wage, job security used to be the thing people aimed for when looking for employment. But in troubling economic times and with unemployment on the rise globally, job security is rarely guaranteed.
Every year thousands of people move abroad in search of better employment opportunities, but unfortunately securing a well paid position overseas doesn’t guarantee a happy ever after.
Being made redundant can be life shattering whatever your situation, but when you’re settled in a foreign country far from home, how do you handle suddenly losing your job?
Although some people head back to the comfort of their families and their country of origin, others are reluctant to give up their expat lives. Here we look at how expats can guard themselves against redundancy, and what action they can take if they lose their job unexpectedly.
1) Prepare in advance
No one likes being pessimistic, but in some situations its pays to be pragmatic. When you first move abroad work out how much money you would need to support yourself overseas for 2-3 months – this is your contingency fund amount.
Throughout your overseas employment set a proportion of your wages aside each month in a specifically dedicated bank account, and don’t stop saving until you’ve reached your contingency fund amount.
Once you’ve reached your target leave the money alone until you need it (you may even want to put it in a high interest account).
With a contingency fund in place you’ll reduce the initial panic which follows being made redundant unexpectedly. You’ll also be able to spend some time considering your next step, whether than means flying home or restructuring your life overseas.
And if you never need to use it you’ll have a nice little holiday fund for your retirement.
2) Find out what money you’re entitled to
Before you begin your employment you should make sure that the redundancy pay you’re entitled to is clearly specified in your contract. You might only be eligible for a small payout, or you might not get anything at all, but it’s always best to know well in advance.
Without a redundancy payout you will need to rely solely on savings until you secure another job, and some redundancy packages can take ages to come through. If the details aren’t mentioned in your contract ask your employer.
Remember though, if you are entitled to a payout and it isn’t mentioned in your contract you may need to take legal action to make sure you’re paid what you’re owed.
Additionally, in some countries the state provides financial assistance to those who have been made redundant. You may even be able to claim on your own state system while overseas, so look in to all your options.
3) Consider taking out an insurance policy
Taking out income protection insurance can be good way of guarding yourself against redundancy or serious injury. However, such insurance policies are typically linked in to your employment contract or your health insurance policy. Again, look into it and make sure you’re aware of your rights.
4) Make a list of your financial priorities
When it comes to ordering your finances there are obviously some things, like rent and health insurance, which should take priority over other things, like gym membership.
Make a list of all your outgoings and highlight those which are essential. By adding up all the essential payments you make in a month you’ll know how much subsistence living costs you.
Then look at all your other outgoing payments. Consider which ones you could cancel immediately if you were made redundant and which costs you could scale back.
If you are made redundant and think you might have trouble meeting your subsistence living costs, talk to your landlord/mortgage provider and any other potential debtors to see what your options are. It’s far easier to handle debt before you get too deeply into it!
5) Don’t leave yourself vulnerable
If you are living in a nation on an employer sponsored visa you may have just a few weeks in which to find another job or organise yourself for leaving the country if you are made redundant.
Draw up a plan for tackling repatriation early on in your time as an expat so it doesn’t seem so overwhelming if you do have to return home. It’s also important to bear in mind that in some nations (like Dubai) having unpaid debt is a criminal offence – don’t let yourself get trapped this way.
6) Try to be positive, and develop a secondary career plan
If you begin a job knowing that you aren’t entitled to a redundancy payout look into what careers are flourishing in your country of residence (or any country you’d like to live in). Then consider whether you could gain a qualification relevant to that career path through evening/weekend classes or online.
Even if you’re never made redundant it will still be an extra string to your bow and could even be a good way of making new friends.
Being made redundant can be devastating, frightening and demoralising – but fight the panic with positivity and productivity and try your hardest not to let it get you down.
Take a holiday if you can and give yourself the time to sort out what you want to get out of life and what you can do to make it happen.
If you receive a reasonable redundancy payout try to think of the situation as an opportunity, and use the money to retrain for a new career/ gain a new qualification/ make your retirement more comfortable.
Whatever happens in your overseas career The Expat Hub wishes you the very best of luck!