Advice on entitlements
All workers that have been retrenched have certain rights under the Fair Work Act 2009, including being eligible for a payout. Payouts are determined by how long you've been with the company and any outstanding entitlements you are owed.
For more information about your rights and obligations, visit the Fair Work Ombudsman website. The Fair Work Ombudsman is an independent statutory office that promotes cooperative workplaces and ensures compliance with Australian workplace laws. The Ombudsman provides many free services to workers and employers in Australia.
The Redundancy Information Statement (RIS) informs workers about their rights and entitlements in the event they are retrenched.
The RIS includes information on redundancy pay, notice periods and financial entitlements. It also outlines support services you can access if you have been made redundant, such as help finding a new job, financial advice, and how to look after your health and wellbeing.
Will my payout get taxed?
In certain circumstances, a portion of your payout may be tax-free up to a certain limit, based on your years of service with your employer.
Visit the Taxation of termination payments page on the Australian Tax Office website for information about the tax implications of any payout you are receiving, including what portion will end up in your bank account after tax.
Receiving Centrelink benefits after retrenchment
Services Australia provides financial assistance (social security payments, or ‘Centrelink’) to job seekers, under certain circumstances. To find out if you are eligible for any Centrelink benefits, or to find a Centrelink Customer Service Centre in your area, use the Centrelink Payment Finder.
Please note: If you receive a payout as a result of your position being made redundant, you may be subject to an Income Maintenance Period that will affect how quickly you can start receiving certain payments and allowances.
Centrelink can also assist you with financial information and a range of services. These are explained below.
Effect of redundancy payment on receiving income support
If you receive a payout as a result of your position being made redundant, you may be subject to an Income Maintenance Period that will affect how quickly you can start receiving certain payments and allowances. Depending on the amount of money you have to support yourself, there may be a waiting period.
Family Tax Benefit
You may need to adjust your Family Tax Benefit estimate or Child Support information. Your entitlement to the Family Tax Benefit may change as a result of your retrenchment.
Low Income Health Care Card
You may be eligible for a Low Income Health Care Card after being retrenched.
Rent Assistance
You may be eligible for Rent Assistance through Centrelink. To receive Rent Assistance, you must also meet the residence requirements of your pension, allowance or benefit.
Special Childcare Benefit
The Special Childcare Benefit provides extra assistance with your childcare fees. It can be granted to families experiencing hardship, including loss of employment. For more information go to the My Child website.
To find out what Centrelink benefits you may be eligible for, please use the Centrelink Payment Finder.
More information can be found on the Services Australia website or by calling 13 28 50.
To contact Centrelink directly, go to the Contact us page of the Services Australia website.
Fair Entitlements Guarantee
Employees who lose their job because their employer went bankrupt or into liquidation may be able to get financial help from the Government.
The Fair Entitlements Guarantee (FEG) is a legislative safety net scheme of last resort that ensures retrenched employees receive their fair entitlements when the employer is unable to meet their obligations. If the employer has not entered bankruptcy or liquidation, FEG payments are not available—you should contact the Fair Work Ombudsman in relation to the employer’s refusal to pay your entitlements.
For more information, including eligibility and how to apply, visit the FEG page. You can also call the Fair Entitlements Guarantee hotline on 1300 135 040.