What to Do If You’ve Been Laid Off or Furloughed Due to COVID-19

Raise your hand if you’ve felt personally victimized by the COVID-19 pandemic. I see you all raising your hands, and for the record, mine is far above my head, waving dramatically too.

We’re all feeling the effects of this international crisis in our own way. We fear for ourselves, our family members, and those we love who are fighting the virus head-on at the frontlines.

We’re going stir-crazy in our homes, trying to find a balance between “using our time wisely” and celebrating the little wins of finally getting to those dishes that have been sitting in our sink for far too long. We’re being exposed to a frenzy of panic media that leaves us feeling unsettled and isolated. Business owners are making hard decisions as a last resort to keep their companies afloat. Employees are losing their jobs and are facing income loss and uncertainty. 

According to the U.S. Department of Labor for CNN, unemployment records have hit an all-time high, with 22 million Americans filing for unemployment in the last four weeks, as of April 16. If you’ve been laid off amidst the chaos, the frightening and unfortunate reality is that you’re not alone. Here are your next steps according to certified life coach and financial planner, Natalie Bacon; career coach, Hannah Gillitzer; and financial counselor, Jessica Moorhouse:


First: Understanding the difference between being furloughed and laid off.

As more companies deal with economic hardships amidst the coronavirus outbreak, it’s likely that more workers will see themselves getting furloughed or laid off in the coming months. 

If you are laid off or furloughed at work, in both cases, you won’t be getting a salary anymore from your employer. However, there are a few key differences between the two statuses, mainly concerning your relationship to the company where you’re employed and the benefits and losses you can expect from each. 

A furlough, which is basically a temporary unpaid leave of absence, means that you still technically work for the company and still hold your current title, as the company plans to have you return to a salaried employee in the future. However, keep in mind that furloughed employees can still be laid off if the company’s economic issues don’t improve or other issues come up, meaning that your job isn’t automatically safe. 

Meanwhile, a lay off is when a worker’s employment—including salary and any health and non-health benefits—is permanently terminated. It is rare for someone who’s been laid off to return to the same position; however, according to the Labor Department in the Washington Post, many businesses have stated to officials that these cuts are temporary and plan on rehiring. 


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While a company’s reasons for choosing to furlough workers instead of laying them off (or vice versa) can vary, there can be some differences in whether or not you’ll still retain certain benefits, or if you’ll still have your healthcare costs and other benefits—like your 401K or retirement—looked after by the company. It can vary, so this is something that you’ll need to look into on a case-by-case basis. 

In most cases, furloughed employees will retain most of the benefits from their job, just minus the salary. However, this has varied depending on employers. For example, Disney has said it will let workers use their paid vacation time towards their period of furlough, while Gap has announced that it’ll let all furloughed workers keep “applicable benefits” (including healthcare) until they’re able to reopen their stores. 

Again, it’s important to note that this will vary from employer to employer, and you’ll need to work with your company to figure out how you’ll be getting employee deductions during your period of furlough if they do allow you to keep your health insurance. Don’t be afraid to ask specific questions or for elaboration from your HR contact.

For laid off employees, this looks a little different. In terms of health care, you’ll typically have to sign up for COBRA coverage to continue the plan you had under your last employer. However, you’ll now be responsible for the costs associated with that. You can also sign up for a plan under the Affordable Care Act, according to the Washington Post.

As millions around the country are laid off or furloughed due to the financial ramifications of the coronavirus, it’s important to remember that you are not alone. To start, you’ll want to apply for unemployment insurance to see if you’re eligible to receive any income as part of the CARES Act that the White House signed into law. If you made under $99,000 last year and filed your taxes in 2018 or 2019, you could be eligible for up to a $1,200 stimulus check as part of the relief plan. 


Banks and Credit Cards 


According to CNet, American Express, Apple Card, Bank of America, Chase, Capital One, CitiBank, Wells Fargo, and more are offering fee and late payment waivers, lower interest rates, payment deferrals, credit card limit increases, and more to help customers deal with any unexpected financial hardships. Reach out to your bank if you need assistance and to find out what they might be able to offer you.




Meanwhile, select insurance providers have also temporarily changed their policies to help customers hard hit by the pandemic. For example, State Farm announced that it will be providing account credits to customers. Again, you’ll want to contact all these providers and explain your situation so they can help you come up with the plan that’s best for you.


Mortgages, Rent, and Utilities 


In terms of housing and utilities, people who are experiencing financial hardship will want to contact their landlords and utility companies separately to see if they can figure out a way to delay or lower their payments. Try not to wait until the bill is due or late. Contacting them sooner rather than later can help both parties come up with a solution.

For homeowners, the Department of Housing and Urban Development announced that it’ll provide relief by pausing foreclosures and evictions on all Federal Housing Administration-backed mortgages for at least 60 days after March 18. Even if your home doesn’t qualify, however, then you can contact your lender to find out what your options are. If you’re a renter, talk to your landlord to see if you can work out any sort of rent relief or delayed payment plan to help during this time.

Meanwhile, the Federal Communications Commission (FCC) has gotten over 700 companies like Verizon, AT&T, and Comcast to agree to not cancel service on phones or internet if customers are late making a payment. If you think you won’t be able to cover utility payments due to economic hardship, get in touch with these companies directly to make sure that service won’t be interrupted.


Student Loans 


Student loan payments can mean a large bill each month, and if you’ve been furloughed or laid off, it could be a major source of worry. If your loans are federally-held, payments and interest are suspended on those loans until September 30, 2020 as part of the CARES Act. However, if you have private loans or loans under the Federal Family Education Loan Program, the CARES Act doesn’t apply, meaning that if you need assistance, you need to contact your lender directly to see what options you may have.

Additionally, your state may be working on student loan relief, so if your loans aren’t federally-held, you may want to look into other options. Illinois Governor J.B. Pritzker announced on Tuesday that those in the state with privately-held loans or Federal Family Education Program loans can contact their lenders for relief options including waived late fees and ensuring that this won’t negatively affect your credit, among other things, according to the Chicago Tribune. 




The IRS is offering relief for individuals, businesses, and others during this time. Tax Day, usually April 15, has been moved to July 15, 2020. If you have a payment that would’ve been due on April 15, your deadline to pay has been extended to July 15. Many states (but not all) also changed their tax deadlines to July 15, according to ProPublica. If you’re unsure whether or not your state deadline changed, contact your state-level Department of Revenue.


Credit Reporting 


Three large credit bureaus in the United States—Equifax, TransUnion, and Experian—announced that they will provide free weekly credit reports to Americans for a year, starting on April 20. The idea is that people will be able to use these reports to help them better manage their finances during the pandemic. According to Bankrate, contacting your credit card companies (sooner rather than later) to see what their policies will be regarding credit reporting right now, whether across the board or on a case-by-case basis. Explain your situation and see what options you may have. 


Food and Immediate Assistance 


If you recently lost your job and are in need of immediate assistance, you can check out food banks (Feeding America is one that operates nationally) or by visiting a nonprofit like 2-1-1 that helps people figure out financial resources depending on their individual needs, whether they’re trying to pay your rent or come up with the money for a utility payment. To get started, all you have to do is call 211 from anywhere in the United States, and then speak with a representative to figure out your options.


If you need help making payments 


No matter what bills you may be struggling to pay during this difficult time, reaching out to the company in question to see what your options may be or what policies they’ve adopted is a good place to start. Doing a little research to see if your city or state has implemented any relief policies or has any guidelines can also help. Many companies are working with customers right now, so it’s worth finding out what they may be able to help you with.


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What to do if you’ve been laid off


Step 1: Acknowledge the loss

While Bacon, Gillitzer, and Moorhouse all have their own strategies for helping clients recover after job loss, they all spoke about the significance of the emotional toll that being laid off takes on a person. “From what I have seen, the worst part of losing a job is the loss,” Gilitzer shared. “Loss of time, finances, dreams, goals, and stability. Loss brings grief.” 

And it’s OK to feel like you’re grieving—you are!

“Hands down, the biggest challenge of losing a job is the mental struggle,” Bacon said. “There’s typically an underlying thought pattern that goes something like this: How did this happen? I must have done something wrong. What now? I don’t know what to do. I need money. I don’t know what’s going to happen. This type of thinking creates feelings of shame, worry, and anxiety,” she continued. “Give yourself permission to feel bad for a day or two. Allow yourself to experience the emotion without rushing to solve the problem and without beating yourself up.”


Step 2: Evaluate your relationship with money

It’s really important to evaluate your money mindset before jumping into budgeting, Bacon and Moorhouse explained.

Moorhouse said that a lot of clients who have found themselves jobless enter a “scarcity mindset,” which she acknowledges is limiting. “In that mindset, the focus is on preserving the money they have instead of focusing on finding creative solutions to make more money,” She stated. “The focus is on playing it safe instead of considering changing careers or industries. This can look like a person only applying to jobs they’re 100 percent qualified for, isolating instead of networking, and jumping at a job without negotiating a salary due to the short-term desire to be employed.”

It’s going to require some reflection.

“Decide how you want to think about your money, then take the action instead of doing it the other way around,” Bacon said. Thinking about your finances in a positive way is key. “An example of this mindset is thinking I’ve created money in the past, so I know I can create more money in the future, or something like, I know value creates money, and I have value to provide, so more money is always coming my way.” 


Step 3: Review and revamp your budget

After reassessing your money mindset, it’s time to address your budget and adjust it as necessary. “Calculate how much money you have in the bank to live off of and determine how much you can bring in through unemployment insurance benefits,” Moorhouse said. “Calculate how much you typically spend in a month and start cutting any non-essential expenses.”

You might not be able to live the same way you were able to before.

“This is the time to live as leanly as possible to stretch your money as far as possible,” Moorhouse continued. “Remember that the sacrifice is temporary. You won’t always have to live your life like this, but if you want to avoid getting into debt, you need to live below your means until you find your next job.”


Step 4: Adopt a growth mindset

Before you pursue new ways to bring in income, you need to adopt a growth mindset moving forward, according to Bacon and Moorhouse.

“You can’t control your circumstance, but you can control your thoughts,” Bacon said. “Ask yourself, ‘How can I think about this in a way that serves me?’ Your brain loves to go to work on answering questions you ask and it will come up with some great ideas.”

Some of her examples include:

  • Losing this job means nothing about me. 
  • I don’t know how, but I know this is happening for me. 
  • I’m stronger than I think. 
  • There are always more opportunities.
  • This job was always supposed to end in this way, I just didn’t know it.  

“After you start directing your brain, you’ll be propelled into positive feelings and action,” Bacon added. “This is where you can create an opportunity out of what was once a loss.” 

Moorhouse noted that losing a job can also become something that’s just another challenge that shows you what you liked and didn’t like about your last job—and what you want in the future.

“If you lose your job, maybe it’s a sign you weren’t in a ‘stable’ job like you thought you were,” Moorhouse said. “I know there isn’t much job stability across the board right now, but it may make you think differently about what jobs you should pursue in the future.”

“The most important thing is to never give up hope. This pandemic is not your fault, and it is not your fault that you lost your job. What’s going on is out of your control,” she added. “That being said, there are some things you can control, such as your reaction and subsequent actions as to what is happening right now. Don’t let the anxiety of the situation demotivate you from taking care of yourself.”


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Step 5: Make your game plan

Before jumping back into the job market, Gillitzer suggested starting your game plan by evaluating your interests, needs (like salary!), and other preferences. “Take an hour or more and think about what you really want, what you are qualified for, and how you can make it happen,” she advised.

Bacon stressed the importance of taking your plan, creating a thought-out schedule, and putting it on paper. “Schedule a block of time—say two hours—every day to research and apply for new jobs. Then each day, get up, shower, get fully dressed in hair and makeup, and get to work during that previously decided upon time. What you’ll find is that you’ll be more energized and take it much more seriously when you have to have a plan and are fully present.” She also suggested adding more specifics to your schedule to build a sense of accomplishment. “Put the exact number of applications you plan to apply for during the time block. This puts you in a results-driven mindset. Your brain will focus on accomplishing that goal instead of spending two hours down a rabbit hole of irrelevant content.”


Step 6: Get back out there

Now that you’ve adjusted your mindset and formed your game plan, it’s time to apply. Maybe it’s been a while since you’ve had to apply for a job, and if that’s the case, it’s likely your resume and LinkedIn profile might need some updating. In addition to tackling your those kinds of housekeeping things, Moorhouse suggested cleaning up your social accounts and making a website. “Recruiters will Google you, so it’s so important to have a strong online presence that presents you as an expert in your field.”

Gillitzer also suggested using a targeted resume for each job that you apply to because it can give you the opportunity to clearly show how qualified you are for that specific job.

“Do your research,” she urged. “Research the company, read over the role, and search the company on places like Glassdoor and Google. If you get an interview, know why you are a good fit for the role and prepare a few stories of times from your past that illustrate that. “

It can be scary or intimidating to start applying for jobs again for fear of rejection, but it’s important to remember that, although it’s true that you probably won’t get every job you apply for, per Gillitzer, it shouldn’t be taken personally. “They aren’t saying no to you … the hiring team didn’t have a secret meeting and decide to hate you! The likelihood is that they’ve said yes to someone else, which means it wasn’t meant to be your job. So very soon it’ll be your turn and the answer will be yes. The answer will always be no unless you try!”

Remember that your current reality is temporary. You’ve been through adversity before, and after this, you’ll likely experience it again. The constant? You and your drive to get through it. Take some time to be upset, be gentle with yourself, and know that you have a whole army of Everygirls rooting you on, every step of the way. You’ve got this, sis!