What to Do After a Tech Layoff: A Step-by-Step Plan

The calendar invite had a vague title. Fifteen minutes later your laptop access is gone and you are holding a severance packet. If you have just been laid off from a tech job, you are not alone, and it is not a verdict on your skills. Layoffs in tech usually follow budgets, reorganizations and strategy changes, not individual performance.

What you do in the next few weeks matters more than how you feel in the first few hours. Some decisions have hard deadlines, such as health coverage and severance review windows. Others, like your job search, go better with a plan than a panic. This checklist walks through both, in order.

This is general information, not legal, tax or financial advice. Rules vary by state and by your specific agreements, so confirm details with your HR contact, your state agency or a qualified professional.

The first 24 hours: secure what you need

Before access disappears completely, focus on information, not decisions.

• Do not sign the severance agreement yet. You almost always have time to review it, and you may have legal rights to a review period (more below).
• Save your personal records. Download your recent pay stubs, your offer letter, any equity grant documents, performance reviews you were given and your benefits summary, as long as company policy allows it. Never take confidential company data or code.
• Collect contacts. Save personal emails or LinkedIn profiles of colleagues and managers who could be references.
• Write down what you were told. Your last day, how long you will be paid, when benefits end, what happens to equity and who your HR contact is.
• Ask for everything in writing. If something was said verbally, request written confirmation.

Then step away. A walk, a call with a friend and a night of sleep will make the rest of this list easier.

Week 1: review severance and your deadlines

Severance is generally not required by federal law; it is offered by the employer, often in exchange for you signing a release of legal claims. Read the whole agreement and note:

• The severance amount and how it is paid (lump sum or continued payroll).
• Whether the employer pays part of COBRA premiums, and for how long.
• What happens to unvested equity, bonuses and unused vacation.
• Non-compete, non-solicit, non-disparagement and confidentiality clauses.
• The deadline to sign and any revocation period.

If you are 40 or older, federal law gives you specific protections when you waive age discrimination claims. Under the Older Workers Benefit Protection Act, as explained by the EEOC, you generally must get at least 21 days to consider the agreement, or at least 45 days when the layoff is part of a group program, plus at least 7 days to revoke after signing. Group layoffs also come with information about who was selected and who was not, which an employment attorney can help you read.

Larger layoffs may also trigger the federal WARN Act. The Department of Labor explains that covered employers, generally those with 100 or more employees, must give 60 days’ advance notice of certain plant closings and mass layoffs, and some states have their own stricter laws. If you received no notice in a large layoff, it is worth asking a lawyer whether the law applied.

Is severance negotiable? Sometimes. Polite requests for more weeks of pay, extended COBRA support, accelerated vesting or a neutral reference are reasonable to ask for, especially if you have long tenure or the release covers significant claims.

Key takeaway: Your 2 most time-sensitive items are the severance review window and health coverage. Put both deadlines on your calendar on day 1, and do not let anyone rush you into signing before you understand what you are giving up.

Health insurance: COBRA vs Marketplace

Losing job-based health coverage gives you 2 main options.

According to the Department of Labor, COBRA generally applies to employers with 20 or more employees, usually lasts 18 months after a job loss and gives you 60 days to elect coverage. Coverage is retroactive once you elect and pay, so you have some breathing room, but do not let the deadline pass. HealthCare.gov confirms that losing job-based coverage opens a 60-day special enrollment period, and that your income for the year (including a lower income while unemployed) affects whether you qualify for savings.

Compare total costs, not just premiums: deductibles you have already met, your doctors and your expected care all matter.

Unemployment benefits: file right away

The Department of Labor advises contacting your state’s unemployment program as soon as possible after becoming unemployed. In most states, you qualify if you lost your job through no fault of your own and earned enough during the state’s base period. You generally file in the state where you worked.

Practical tips:

• File in the first week. Delays can cost you benefits; first payments often take 2 to 3 weeks.
• Report severance accurately. Some states delay or reduce benefits while you receive severance or pay in lieu of notice; others do not. Check your state’s rules.
• Keep a job search log. Most states require you to look for work and report it each week.
• Understand the cap. Weekly benefits are capped by each state, so for most tech salaries they replace only part of your pay.

Protect your 401(k), HSA and equity

401(k). You do not need to do anything right away. Your options are typically to leave the money in the old plan (if allowed), roll it into an IRA or roll it into your next employer’s plan. Cashing out usually triggers income tax and, if you are under 59 1/2, a possible extra tax. If you have an outstanding 401(k) loan, it may be offset when you leave. The IRS explains that for a qualified plan loan offset after leaving a job, you generally have until your tax filing deadline, including extensions, to roll over the offset amount and avoid it being taxed as a distribution.

HSA. Your health savings account belongs to you. The money stays yours after the layoff.

Equity. Find out what vested and what did not. For stock options, check the post-termination exercise window, which is often short. Our guide to stock options vs RSUs explains the questions to ask. Decide on exercising with a tax professional, not under deadline panic.

Visa holders. If you are in H-1B or certain other work visa categories, USCIS describes a grace period of up to 60 days (or until your authorized stay ends, if sooner) to find a new sponsor, change status or leave. Talk to an immigration attorney immediately.

Build a short runway budget

List your monthly fixed costs, then your cash: severance, savings, expected unemployment benefits. Divide to get your runway in months. Pause non-essential subscriptions and big purchases until you have an offer. If your runway is short, consider contract or freelance work as a bridge; our comparison of W-2 vs 1099 work shows how to compare a contract rate with a salary, and our guide to freelancing in tech covers getting started.

Restart your job search with a structured plan

Give yourself a few days to rest. Then treat the search like a project with weekly goals.

Step-by-step restart

1. Decide your target. Same role, a step up, a pivot or contract work? Write 1 to 2 sentences.
2. Update your resume. Add your most recent role and quantified results. Use our tech resume guide.
3. Refresh LinkedIn. Update your headline and About section and decide on Open to Work visibility. See our LinkedIn profile tips for tech jobs.
4. Tell your network. A short, positive post or direct messages to former colleagues work well. Laid-off teammates often share leads with each other.
5. Ask for referrals. Referrals typically move faster than cold applications.
6. Practice interviews. Refresh coding, system design and behavioral answers. Have a calm, 2-sentence answer ready for “Why did you leave?” (“My role was eliminated in a company-wide reduction affecting X teams.”)
7. Track everything. A simple spreadsheet of applications, contacts, stages and follow-ups.
8. Negotiate when the offer comes. A layoff does not mean you have to accept the first number. Review our guides on evaluating a job offer and negotiating a tech salary.

A sample weekly rhythm

Searches take time, and rejection is part of the process. Protecting your health and routine is part of the plan, not a break from it. Our guide on avoiding burnout in tech has habits that help here too.

Conclusion

A tech layoff is a hard stop, but it does not have to be a free fall. Secure your documents, respect the deadlines for severance and health coverage, file for unemployment quickly and protect your retirement and equity. Then rebuild momentum with a clear target, an updated profile and a weekly routine. Most people who work a structured plan land somewhere good, and many land somewhere better.

Sources

• U.S. Department of Labor: FAQs on COBRA Continuation Health Coverage for Workers — election period, duration and payment deadlines
• HealthCare.gov: Options if you lose job-based health insurance — 60-day special enrollment period
• EEOC: Understanding Waivers of Discrimination Claims in Employee Severance Agreements — 21/45-day review and 7-day revocation rules
• U.S. Department of Labor: Plant Closings and Layoffs (WARN Act) — advance notice requirements
• U.S. Department of Labor: Unemployment Insurance — eligibility and when to file
• IRS: Retirement plans FAQs regarding loans — rollover deadline for plan loan offsets