How Much To Spend On Outplacement?
How much should a company spend on outplacement? What is the value to the organisation of assisting a colleague who has been made redundant to find new work? The question was driven home to me this week when I met a senior director of a well known company in the transport sector who had been offered the equivalent of three days pay to spend on his job search support.
When companies make people redundant they pay a severance package. Outplacement support is seen as part of this package. So someone receiving six months salary as compensation might count themselves lucky to get any additional amount for outplacement. But it doesn’t work like that. Outplacement is a benefit to the company as well as the departing staff member. It shows the company in a good light, both internally and externally, it makes the company an attactive place to work and it is socially responsible.
The cost of an outplacement package should be related to the likely time it will take the departing person to find work. An older, senior person whose options are more limited will need more support than a young one whose career path is more flexible. The director who I met may well spend a year looking for a new job. His outplacement support should reflect that.
The rule of thumb is to spend the equivalent of a week’s salary for every £25,000 earnt. So our director should have the equivalent of three week’s money spent on him, not three days.
I didn’t tell him. Should I?
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Tags: Career Advice, Career Consultant, Career Energy, career professional, Getting A New Job, job hunting, job search, new job, outplacement, Redundancy, unemployment
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