Hearing that you are being let go can feel like a physical blow, leaving you with a mix of anger, fear, and confusion. Even if you work in an industry like tech where a wave of layoffs has been making headlines, it still feels deeply personal when it happens to you. Take a moment to acknowledge those feelings, but remember that you are not powerless and this is just one chapter in your larger journey.
Pause and catch your breath
Recognize that your system has just gone through a shock. You are not the first person to face this challenge, and you certainly won't be the last. It is easy to spiral into panic and think you need to fix everything right now, but this isn't a problem you have to solve in 15 minutes.
Even if the news blindsided you in a meeting, it is okay to excuse yourself to take a break. Take several slow, deep breaths to calm your nerves. It might sound cliché, but it is a good way to steady yourself. Tell yourself you will be okay because you truly will be. Once you have collected yourself, you can tackle the practical steps one by one. The rest can wait.
Gather your documents
Before you look into state or federal protections, you need to know exactly where you stand with your company. Review your internal documents to understand your specific rights as an employee.
Look for your employment agreement or contract, the employee manual, and any union agreements if applicable. If possible, email copies of these documents to your personal address. You should also save any emails or other documents that amended your original agreements so you have a complete paper trail.
Don't sign anything in haste
Your former employer might pressure you to sign a severance agreement immediately. They may even imply that receiving your final paycheck, accrued vacation time, or other perks is contingent on your signature.
It isn't. A severance agreement is a legal document, and it may be negotiable or reviewable by your attorney. Most state laws require employers to allow employees time to review that agreement. Under federal law, your employer generally doesn't have to pay you immediately, but you must generally be paid no later than the next payday.
Some states have stricter rules. For instance, if your contract or employee manual offers payment for accrued vacation time, that pay often cannot be withheld just because you haven't signed a severance agreement.
Negotiate your exit
It might be hard to advocate for yourself in the heat of the moment, but if your company is open to negotiating the layoff terms, you should try. Think about what would help you most during this transition.
You might ask for additional pay, extra months of healthcare coverage, or a letter of recommendation. You could also request career counseling or job search support, as well as clarity on your stock options. If you weren't fired for cause but were laid off or furloughed, it is smart to request a letter specifying exactly why you were terminated.
Know your legal rights
Laws vary depending on where you live and the size of your organization. Some states require severance or specific notice periods when employees are being laid off. For example, California requires employers to provide a 60-day written notice before a mass layoff.
Check your state's Department of Labor website to find the rules that apply to you. If you suspect you were chosen for layoffs due to discrimination based on your age, gender, religion, or another legally protected class, you should consider consulting an employment attorney.
File for unemployment immediately
If you are eligible, file for unemployment as soon as possible. Even if you are receiving severance pay, which might delay your compensation, getting your claim into the system is important because processing can take a while. There is no shame in this; you and your employer have been paying for it for this very reason.
Generally, to qualify for unemployment benefits, you must:
- Have earned enough wages during the base period.
- Be totally or partially unemployed.
- Be unemployed through no fault of your own.
- Be physically able to work.
- Be available for work.
- Be ready and willing to accept work immediately.
Secure your healthcare coverage
Unless you can jump onto a spouse's or partner's plan, or your employer agrees to pay your premiums, you generally have two main options for coverage.
COBRA
The Consolidated Omnibus Budget Reconciliation Act, or COBRA, allows you to remain on your employer's health care plan for 18 months. However, chances are both your premiums and deductibles will increase, possibly significantly, because your employer will almost certainly cease paying a portion of your premiums.
The Marketplace (Obamacare)
The Affordable Care Act, often called Obamacare, may be a better option. This is especially true if your state has a robust healthcare marketplace. State-by-state guidance is free and available from the federal government. Just remember that there are time limits, so don't delay this process.
Review your financial roadmap
Now is the time to look at your current expenses and sources of income. Are there any expenses you can reduce or eliminate temporarily?
Take stock of your resources. Do you have a side hustle or part-time job that can be expanded? Can friends, relatives, or community or religious organizations provide financial or emotional support? Knowing your numbers will give you a sense of control.
Reassess your career path
This transition might actually be an opportunity to rethink your career. Ask yourself if you are ready to try something new. Do you have transferable skills that you can use in another job or industry?
If you aren't sure where to look next, an employment consultant, recruiter, or trusted friend can serve as a valuable resource. Just keep in mind that recruiters are in the business of connecting employers and employees; they aren't therapists. The place to talk out your feelings is with your friends or a mental health professional.
Maximize your network
Use every tool at your disposal to land your next job. Even if you graduated years ago, consider tapping your alumni associations and job boards. And, of course, network, network, network. There is no shame in telling people you are available.
Professional organizations can also be excellent sources of job leads. If you would prefer to stay in the same industry, research industry events and make connections. If it helps, stay in touch with your co-workers as well. If anyone understands what you are going through, it's them.
The Facet difference
Navigating a job loss affects every part of your financial life, from your short-term cash flow to your long-term retirement goals. At Facet, we believe you shouldn't have to figure this out alone.
Our membership model gives you access to a CFP® professional who works with you to adjust your financial roadmap when life throws you a curveball. We don't charge commissions or percentage-based fees, so our advice is objective and focused on helping you achieve wellness and stability.
