JSA after redundancy

[jotheblondeone]

Hi my other half is being made redundant after 19 years and we are to get redundancy payment of just under £6000 as a cheque and a company enhanced package of about £3000 which is taxable and will be in his last wage.

We are in the process of starting a DMP as we have many debts and are struggling even before redundancy. We were thinking of paying the £6000 off mortgage which will reduce payments. Then with the £3000 we have to clear two overdrafts (about £900) so that we still have an active bank account which is in credit for the DMP and owe a family debt of about the same.

 

So my question is can JSA stop us from getting any money due to the redundancy even if it is paid out or are you allowed so much before they can touch it. I got told off someone they can force you to live of the redundancy first. Any help or advice would be appreciated.

Thanks

Jo

[ErikaPNP]

If I had a quid for every time I heard "Someone told me this" and that someone was wrong, I'd be living in beautiful barbados by now!!

 

If he has been an employee for 2 years or more and has paid class 1 NI contributions during that period, he will qualify for Contribution based JSA. This will entitle him to £64.30 per week for a maximum of 26 weeks. They do not take capital or other household income into account where contribution based JSA is concerned, as it is not means tested.

 

If after 26 weeks of contribution based JSA he has not secured employment, he can claim income based JSA. This is where they will consider other household income, and capital. If you work 24 hours or more per week he is unlikely to qualify for income based jobseekers allowanace. He can have up to £6000 without it affecting benefit. Anything between £6000 and £16000 will affect any means tested benefit. Anything above £16000 will disentitle him to means tested benefit.

[sallysas]

Redundancy payments are disregarded for housing and/or council tax benefit as well - but they will want to see bank statements for proof of capital as your husband is claiming jsa©.

[jotheblondeone]

Hi, thanks Erica and Sally for your replies - much appreciated. I am on long term incapacity and low rate DLA, and we get tax credits - so is £64 the total he will get while on contribution based Jsa or is topped up by income support etc

[andydd]

Hi my other half is being made redundant after 19 years and we are to get redundancy payment of just under £6000 as a cheque and a company enhanced package of about £3000 which is taxable and will be in his last wage.

We are in the process of starting a DMP as we have many debts and are struggling even before redundancy. We were thinking of paying the £6000 off mortgage which will reduce payments. Then with the £3000 we have to clear two overdrafts (about £900) so that we still have an active bank account which is in credit for the DMP and owe a family debt of about the same.

 

So my question is can JSA stop us from getting any money due to the redundancy even if it is paid out or are you allowed so much before they can touch it. I got told off someone they can force you to live of the redundancy first. Any help or advice would be appreciated.

Thanks

Jo

 

Redundancy money doesnt count when being awarding contribution based JSA but being paid in leiu of notice will. (i.e If youve been paid for next 4 weeks, you have to wait till the end of that period to get JSA).

[ErikaPNP]

Hi, thanks Erica and Sally for your replies - much appreciated. I am on long term incapacity and low rate DLA, and we get tax credits - so is £64 the total he will get while on contribution based Jsa or is topped up by income support etc

 

No, that is the absolute maximum, £64.30 as it is not dependent on household income. If it was then they would take household income and the capital into account, as they will do once contributory based JSA runs out at the 26 week mark if he hasn't found work.

 

However declare your change of circumstances to tax credits as they will need to adjust the award. You may get more or you may get less, either way it will avoid an incorrect award at the end of the tax year. He would no longer be entitled to working tax credits if he was receiving them. If this goes undeclared, you will find yourself with a big overpayment at the end of the tax year, which they will claw back.

 

You MAY also be eligible for Council Tax Benefit and Local Housing Allowance (the new housing benefit - if you rent)

 

You can get an idea of entitlement by entering your details into Start Calculation - but it is JUST a guide.

[InformedSearcher]

'ErikaPNP', JSA was erm £60.50 the last time I looked - has this been increased?

 

'andydd', you sure about that regarding PILON payment?? You date of redundancy is the date employment ceased and the PILON is classed as paying you rather than keeping you in work by way of 'keeping you from opening up the preverbial can of worms'. IMHO you can claim straight away and of course show DWP the letter regarding the redundancy payments.

 

JSA is classed as taxable income by the way.

 

Housing Benefit claim officers will probably calculate and tax credits and adjust (if any) benefits accordingly. They are (sadly) a bit more smarter than one might imagine.

 

Michael

[ErikaPNP]

'ErikaPNP', JSA was erm £60.50 the last time I looked - has this been increased?

Informed searcher it seems you aren't that well informed! :grin:

 

It was increased in April. Contributory based JSA is £64.30. Unless of course the claimant is aged under 25 where the applicable rate would be £50.95.

 

for Income Based JSA the rates are:

 

single person/lone parent over 25: £64.30

Lone parent under 18: £50.95

16 - 18 year old singles: £50.95

couples aged over 18: £100.95

[InformedSearcher]

Informed searcher it seems you aren't that well informed! :grin:

 

It was increased in April. Contributory based JSA is £64.30. Unless of course the claimant is aged under 25 where the applicable rate would be £50.95.

 

for Income Based JSA the rates are:

 

single person/lone parent over 25: £64.30

Lone parent under 18: £50.95

16 - 18 year old singles: £50.95

couples aged over 18: £100.95

 

Thank for that (and damm!).

My 6 months ended 21 March 2009.

If I were aged under 25 I'd be okay as I'd get a job but at 55 the 'dynamic' bit in job vacancies is starting to fail due to frustration and despair. LOL

Michael

[jotheblondeone]

So when you say single person and couple rates for JSA - what does that mean - can he only claim for himself or is there an allowance for partner/kids? All we get is child tax credits and incapacity. I read somewhere there was disabled premium but that could have been income base JSA.

[InformedSearcher]

So when you say single person and couple rates for JSA - what does that mean - can he only claim for himself or is there an allowance for partner/kids? All we get is child tax credits and incapacity. I read somewhere there was disabled premium but that could have been income base JSA.

 

This will probably answer all your questions (hope the link is allowed?)

 

Jobcentre Plus - Working Age Benefits Jobseeker's Allowance

 

Michael

[ErikaPNP]

No, he will only get £64.30 Jo, because this is all contributions based is. Couples rates apply to Income Based JSA. The allowance for your children doesn't come from JSA it comes from tax credit.

[InformedSearcher]

'ErikaPNP' (sorry off topic) but love the avatar (and nnedless to say taken a copy)! LOL

Michael

[ErikaPNP]

Lol infomredsearcher, I decided to put that up after getting many jibes re my advice.....where the answers are factual but not what people wanna hear!!

[InformedSearcher]

Lol infomredsearcher, I decided to put that up after getting many jibes re my advice.....where the answers are factual but not what people wanna hear!!

 

I can relate to that entirely and probably one of the reasons I'm in the desperate, frustrated and 'utterly broke' world of the unemployed currently!

Michael

[jotheblondeone]

Hi my hubby has phoned from work as his mate (who is also being made redundant) has been told by one of the bosses that he probably wont be entitled to JSA (cb), as the last wage will include 12 weeks pay.

Now from the advice I have been given on here, it seems that only payment in leiu of notice would be taken into account.

I have had a look on his revised redundancy letter (the first letter gave a leaving date of 28th July but they needed them to stay on longer) and so the new leaving date is 28th August.

It seems that the 12 weeks pay in the final wage is 12 weeks leiu of notice. So does that mean we will not get JSA (cb) at all and if not for how long? Is council tax benefit affected too?

[ErikaPNP]

JSA contirbution based is not affected by capital. His boss is wrong. It would affect JSA income based and may affect council tax benefit as they are means tested benefits.

[jotheblondeone]

Thanks Erika, is it true that P I L O N is now classed as capital (from 2007). Our total capital would be £9000 after tax, but around £1000 of that would be taken straight away to pay off overdraft, as a condition of starting DMP with CCCS.

[InformedSearcher]

Thanks Erika, is it true that P I L O N is now classed as capital (from 2007). Our total capital would be £9000 after tax, but around £1000 of that would be taken straight away to pay off overdraft, as a condition of starting DMP with CCCS.

 

The problem is PILON is classed as taxable pay which of course it is. In fact in reality there's nothing to stop an employer adding this to the actual redundancy package and provided not (if I recall) making a total of more than £30k would be tax free. Of course employers realise they could run the gauntlet of an employee coming back and saying they'd not been given notice. To overcome that an employer could make a 'compromise' agreement to alleviate such problems.

Michael

[ErikaPNP]

Redundancy pay doesn't affect it, PILON does. He should still make a claim though because if he doesn't, he won't get NI credits paid for him.

[InformedSearcher]

Hi my hubby has phoned from work as his mate (who is also being made redundant) has been told by one of the bosses that he probably wont be entitled to JSA (cb), as the last wage will include 12 weeks pay.

Now from the advice I have been given on here, it seems that only payment in leiu of notice would be taken into account.

I have had a look on his revised redundancy letter (the first letter gave a leaving date of 28th July but they needed them to stay on longer) and so the new leaving date is 28th August.

It seems that the 12 weeks pay in the final wage is 12 weeks leiu of notice. So does that mean we will not get JSA (cb) at all and if not for how long? Is council tax benefit affected too?

 

I'm guessing your husband is employed by a reasonably sized company? If so they should have set up a 'consultation group'. I was elected (god knows why) to be on the one when I was made redundant last year. The group can bring up anything and everything with an employer. In my case I started overstepping the mark by trying to make it 'negotiation'raher than 'consultations' which did me no favours. LOL

As 'ErikaPNP' says it does not effect JSA. Make sure he registers immediately after redundancy as they don't backdate benefits.

On the sad note though, here's me, almost a year after being made redundant and still unemployed whereas at the time of redundancy it was a kind of exciting challenge. Nothing to show for almost 40 years of working life.

Michael