What To Do When You Get Laid Off
Receiving news of a layoff can be overwhelming, disorienting, and emotionally challenging.
With economic uncertainty and corporate restructuring becoming increasingly common, more workers are facing this difficult situation. While it may feel like your financial world is crumbling, having a strategic plan can help you navigate this transition with confidence and resilience.
At The Financial Gym, we understand that layoffs often come without warning and can threaten your financial stability. This guide outlines practical steps to take immediately after receiving layoff news, helping you protect your rights, manage your finances, and position yourself for future opportunities.
Remember, a layoff is not a reflection of your worth or abilities—it's a business decision often driven by factors entirely outside your control.
Essential Steps to Take After Being Laid Off
Immediate Actions (First 24-48 Hours)
Review your employee contract thoroughly to understand termination terms. You want to make sure that you know everything you were promised in your contract, like severance or certain rights. Pay particular attention to non-compete clauses that might limit your job search.
Document everything. Take notes of every conversation, interaction, email, and piece of information that could be relevant to you in case you have an issue with your layoff. Keep a detailed outline of events, including times and dates for verbal conversations.
Ask your employer these critical questions suggested from BetterUp:
When can I expect to receive my last paycheck?
“Depending on your termination agreement, you may receive your final pay immediately. Double-check the amount and deductions for any errors. If you're part of a mass layoff subject to the WARN Act, you may be entitled to 60 days' notice before termination (BetterUp).”
Will I be compensated for my unused paid time off or sick leave?
Can I expect severance pay?
What will happen to my 401(k) / pension plan?
Will I have health insurance coverage after my last day of work?
Understand your COBRA eligibility and timeline for enrollment
Will you provide a reference for me?
Can I have copies of my performance reviews?
How long do I have access to projects I'm working on?
What happens to any stock options or restricted stock units?
Will the company provide outplacement services or career counseling?
Get your termination in writing. Request an official termination letter that clearly states you were laid off for reasons outside your control. This documentation is crucial for unemployment claims and for explaining the situation to future employers.
Secure recommendation letters from supervisors, colleagues, and other reliable references at your company who can speak to your skills and work ethic.
Gather important work materials before losing access. Forward yourself any materials you think you will need, like portfolio materials, templates/workflows, important emails (especially for legal concerns), and any notes/records of your work. Make sure to consult and abide by any non-disclosure agreements you've signed.
Next Steps (First Week)
Process the experience emotionally. Take your time to feel what you need to feel about this. It's okay to feel resigned, sad, or angry for the first few days after. Consider speaking with a therapist or counselor who specializes in career transitions.
File for unemployment benefits in your state as soon as possible. There's often a waiting period before benefits begin, so don't delay this step. You'll need to check your eligibility and gather necessary documentation, including your termination letter.
Address your healthcare needs. If your employer provided health insurance, determine when your coverage ends and explore options like COBRA, your spouse's plan, or Healthcare.gov marketplace plans. Don't leave yourself uninsured.
Contact your bank and creditors. According to NerdWallet, credit card issuers and utility companies may extend payment due dates or offer hardship programs if you ask. You may be able to pause student loan payments to give yourself more financial space.
Adjust your budget immediately. If you're working with one of our Financial Trainers, book a check-in call so we can strategize around your emergency savings and create a budget that lasts as long as possible. Cut non-essential expenses and prioritize necessities.
Moving Forward (Weeks 2-4)
Update your resume and LinkedIn profile. Highlight your achievements and quantifiable results. Consider working with a career coach to optimize your job search materials.
Set a realistic job application schedule. Balance your search efforts with self-care to avoid burnout. Quality applications often yield better results than quantity. Consider setting a goal of 2-3 high-quality applications per day rather than dozens of generic submissions.
Expand your professional network. Reach out to former colleagues, attend industry events, and join relevant online communities. Many opportunities come through connections rather than job boards.
Consider upskilling or reskilling. Use this time to enhance your marketability by learning new skills or earning certifications relevant to your field or a field you'd like to enter.
Explore alternative income sources. Freelancing, consulting, or part-time work can provide income while you search for your next full-time position. Gig economy platforms may offer flexible opportunities.
Make sure to still enjoy your time off. Plan a few activities and self-care days that you have wanted to do but haven’t had time for! Maybe even spare a bit of your budget for a nice treat for yourself (just one). Applying for jobs is a job in itself, but it doesn’t have to take over your whole life. Use this time off as a chance to rest and recharge so you can go into your next job with new energy and excitement. Plus, you’ll have an easier time getting a job if you’re feeling good during the application and interview process instead of bringing old stress and burnout energy with you.
Special Circumstances:
Union members: If you're part of a union, reach out to your union representative immediately for further assistance and to discuss if there is any legal recourse. Your collective bargaining agreement may provide additional protections.
Federal employees with military service: You can see if there is a way for you to buy/transfer your military service to combine with government service so you don't lose your years of service.
Potential wrongful termination: If you feel that you've been wronged in any way during a layoff, schedule a consultation with an employment lawyer in your state. There may also be class action lawsuits or open legal cases depending on the nature of your layoff. It's better to discuss with a lawyer sooner rather than later.
Visa holders: If you're working in the U.S. on an employment visa such as an H-1B, consult with an immigration attorney immediately, as your legal status may be affected by job loss.
A layoff, while challenging, can sometimes become an unexpected catalyst for positive change. Many professionals report finding more fulfilling, better-compensated positions after navigating the difficult terrain of job loss. The key is to approach this transition methodically, protecting your rights and financial health while maintaining a forward-looking perspective.
At The Financial Gym, we've helped countless clients transform layoffs into opportunities for financial growth and career advancement. If you're facing this situation, remember that you don't have to navigate it alone. Our Financial Trainers can help you create a customized financial plan that addresses your immediate needs while supporting your long-term goals.
Remember that your worth isn't defined by your employment status, and this challenging chapter doesn't determine your entire career story. With the right approach and support, you can emerge from this transition stronger, more resilient, and better positioned for future success.
Need personalized guidance during your layoff? Schedule a free initial consultation with our team to get matched with your own Financial Trainer today. We're here to help you navigate your financial journey with confidence, even during uncertain times.