Sorry to hear rollingstone. Tough times, but you seem to have a good sense of what's realistic, and are taking a level headed approach to your situation.
First question, do you know anyone in the company who has previously been made redundant? If so, get their details and call them up. They will be the best source of advice and preparation for the road ahead.
I've just been told that my role is to be made redundant, likely effective before the end of this year (consultation period with the employer just about to start). Been with the company almost 20 years so a lot of emotions going through me right now. Early 50s as well, so I think getting a similar role will be difficult - a friend in recruitment has been quite open with me on that (I work in Finance, in a multinational). Anyways, all that aside, I need to focus on the here and now. Can anyone provide some clarification on the following queries?:
- waiving the right to the pension lump sum. I am in a DC scheme, and the admin portal has a forecasting tool. Based on my current and projected contributions (assuming of course those contribution levels were to be maintained, unlikely now perhaps), at the age of 65 I could be entitled to a lump sum of approx €150k. If I waive the right during the course of redundancy discussions, does this effectively mean that this pension lump sum figure would then become fully taxable, and at the marginal rate?
Correct, though there wouldn't be a lump sum per se. You would roll your whole pension over into a ARF, annuity etc Once done it would be subject to tax once you start to draw it down.
Unless the tool you're referring to is something specifically provided as part of the redundancy process, it's unlikely to have any relevance. Per what I've researched, the actuaries use a formula to calculate a present value lump sum, which is actually based on your earnings and service-years, and therefore independent of your current pension pot.
- the annual company bonus is a discretionary payment (typically it is a significant amount). I will have worked the full year, but the related payment is made during quarter 1 of the following year, at which point I will have left the company. Probably have to suck it up, but has anyone been in a similar position, and negotiated a payment with the employer in lieu of same? I feel I have made the usual contribution for the full year, but ultimately my employment contract does state that it is discretionary.
Find out what your company policy is. You mention its a MNC so I'd be highly surprised if they don't have one. It should detail what applies for the bonus payment, ditto for RSUs (if applicable) and any other benefits.
- there are some good insights already on this thread, and the related forum so I'm reading up as much as possible on the topic. But if there is anything else that I should be considering or prioritising during this consultation period, I'd really appreciate your inputs.
Thanks in advance.
Assuming you'll receive an ex-gratia payment, tax relief is a really important topic. Given your length of service, SCSB is likely to be the most beneficial to you. Recommend to read up thoroughly on it, here's
one link I came across, there are many others. Other things which come to mind include, how long they will continue to pay health insurance (if applicable), what support / training they will provide & will they offer time off for interviews.
Best of luck.