Unemployment Insurance Benefits
Unemployment insurance benefits are payments made to eligible employees who become unemployed through no fault of their own.
There is an Unemployment Insurance Program in each state. Under federal guidelines, each state sets its own rules. State rules cover eligibility for benefits, benefit amounts, and the length of time workers can receive benefits.
Employees can usually receive benefits for up to 26 weeks. This depends on how long you worked before you lost your job. During times of high unemployment or in special situations, states can provide extended benefits.
The amount of your unemployment payment depends on how much you earned in your last job. Each state also sets a maximum benefit amount. Most employees get less than half of their previous weekly earnings.
Some workers who already collect Social Security retirement benefits may not get their full unemployment benefits. If their employer lays them off and they apply for unemployment insurance, 19 states will reduce their unemployment benefits by the amount of their retirement benefits. Many workers and employers are not aware of this offset.
Unemployment insurance is taxable income. Most states do not automatically withhold taxes from unemployment benefit checks. You can request that your state withhold federal taxes.
General Eligibility
To receive unemployment benefits, you must meet several requirements. However, it makes sense to apply, regardless of your situation. The rules are complex and may change, so don't rule yourself out by not applying.
Here are the main requirements:
- During the period before you apply for benefits, you must have worked as an employee for a certain amount of time and earned a certain amount of money.
- Your state must agree that you became unemployed through no fault of your own.
- You must be able to do your old job or a similar job, register for work, be available for work, and actively look for a new job.
- You must be a U.S. citizen or be legally able to work in the U.S.
Each state sets its own rules for these requirements.
Even if you lose a part-time job, it is a good idea to apply for benefits. Some states do allow part-timers to receive benefits. And in some states you can receive benefits even if you have another part-time job.
In several states, dislocated workers can use their unemployment benefits to create their own jobs by starting their own small businesses. States with this Self Employment Assistance program include Delaware, Maine, Maryland, New Jersey, New York, Oregon, and Pennsylvania.
Your employer may offer a severance payment when you lose your job. Be sure to find out if accepting the severance will affect your unemployment insurance claim or benefits.
You may decide to move to another state to look for a new job. If you meet the requirements of the state in which you lost your job, you can receive benefits in your new state.
In general, independent consultants and contractors, employees paid only by commission, and farm workers are not eligible for unemployment benefits.
In some states, employees who are disqualified from unemployment benefits may become eligible after a waiting period.
Unemployment insurance rules change. So it doesn't hurt to ask for details or apply for benefits, even if you think you are not eligible.
Special Circumstances
- Only employees who become unemployed through no fault of their own may get unemployment insurance. You may not be sure if you have met the no-fault requirement. The states use different rules to decide what "no fault" means. It is a good idea to apply for unemployment benefits and let your state decide if you are eligible.
- If you lose your job through downsizing, you are likely to be eligible for unemployment benefits.
- If you lose your job due to "willful misconduct,"
you may or may not be eligible for benefits. This depends on
which rules your state uses.
Willful misconduct is serious, deliberate, and usually happens more than once. An employee who is dismissed for disobeying a known company rule on purpose would probably be considered guilty of willful misconduct, and would not be eligible for benefits. But an employee who is dismissed for not performing the job well would not be considered guilty of willful misconduct and may be eligible for benefits.
- If your state uses "just cause" rules, the employer may be considered to have good reason to dismiss a poorly performing employee. In that case, the employee may not be eligible for unemployment benefits.
- If you quit your job, you are usually not eligible for
unemployment benefits. But you may be eligible if you quit for
"good cause." There are big differences in how the
states interpret good cause.
In a few states, you may still be eligible for unemployment benefits if you quit your job for a personal reason, such as caring for a family member who is ill. In most states, "good cause" must be something that the employer does to justify your quitting your job.
When you apply for unemployment benefits based on one of those reasons, you must show that you have asked your employer to correct the situation. You must also show that the situation would cause any reasonable person to quit.
How to Apply
Apply for unemployment benefits as soon as you lose your job. It usually takes two to three weeks before you receive your first benefit check. But your benefit amount will cover all the time since you lost your job, except, in most states, for a one-week waiting period.
Go to an office of your state unemployment insurance agency. Find the office closest to you by clicking on your state in the State Unemployment Insurance Offices link below. Ask if you can apply by phone.
Ask what information and papers to bring with you when you apply.
In general, you will need:
- Social Security card
- Addresses, phone numbers, and dates about your former employment. Bring pay stubs and W-2 forms that show your employers' IRS identification numbers.
- Any papers that explain your job loss, such as a letter from your employer.
You have the best chance of getting unemployment benefits in a timely way if you are on time for all appointments and follow all the rules in your state.
Looking for Work
After your unemployment benefits are approved, state rules require you to do one or more of the following:
- Register for work with the state employment service.
- Be available to work in your local area.
- Be physically able to work.
- Apply for a certain number of appropriate jobs.
- Accept a suitable job if it is offered. A suitable job is equivalent to the job you had before.
- Sign documents stating that you continue to meet these requirements.
Each state provides many job-search services through Career One-Stop Centers.
What If Your Application is Denied?
You have the right to appeal any denial of unemployment benefits.
Your state unemployment office will tell you about your appeal rights. States are very strict about the timing of appeals. Be sure to file your appeal within the required time.
If you appeal a denial of benefits, you will have a hearing. You can bring witnesses to this hearing. You can handle the hearing yourself or you can hire a lawyer to help you.
Most states have brochures that explain the appeals process in detail.
Additional Resources
About
Unemployment Insurance
Eight fact sheets about every aspect of unemployment insurance.
State
Unemployment Insurance Offices
Explains unemployment insurance in your state and how to apply.
Weekly
Unemployment Benefit Calculator
Estimates the amount of your unemployment benefit.
Unemployment Insurance
Safety Net Project
The National Employment Law Project's proposed reforms of the
state-federal unemployment insurance program.
Career One-Stop
Centers
Job-search help
Books
Find these books online at Barnes and Noble.com
The American Bar Association Guide to Workplace Law: Everything You Need to Know About Your Rights As an Employee or Employer, Barbara J. Fick, the American Bar Association, 1997. Includes a brief, clear chapter explaining how the unemployment insurance system works.
Your Rights in the Workplace, Attorney Barbara Kate Repa, Nolo Press, 2005. Has an unemployment chapter with many examples of how you may be eligible for unemployment benefits.
How to Win Your Unemployment Compensation Claim, Lawrence A. Edelstein, Sourcebooks, 2002. Step-by-step advice for applying for unemployment benefits or appealing your claim if it is denied.
