Unemployed While Employed

Most workers on short-term (one day a month, for example) furloughs will not qualify for benefits. If this is your case, it is still worth contacting your state unemployment agency. You may qualify for partial unemployment benefits based on your earnings and lost wages due to reduced work hours. Be certain to ask your employer if you will qualify for unemployment benefits before you begin your furlough; your managers should have already researched the question.

Q: I’ve worked for a state university for more than 28 years, and we have been told [we] will have 10 mandatory furlough days before December 31, and perhaps additional days during 2010. I planned to work only a few more years, and this could mean a loss in my service time. I work 34 hours a week, and this could mean that my average weekly hours fall and cause me to become ineligible for health benefits. Also, with less pay, my savings and employer match will decline, and I’m only a few years from retirement. I also have a lot of accumulated sick and vacation time. What will this furlough mean for me and my employer benefits? – Raphael, Texas

A: Raphael, the issue of employee benefits should be of less concern to you than the loss of pay. Most employers instituting furloughs are doing it to protect workers from permanent job loss and layoffs. A limited reduction in pay will cause short-term pain, but the loss of health benefits or reduced savings would have major and longer-term consequences.

Generally, employers continue all regular benefits for which you’re eligible, despite your furlough. This includes health care, life insurance, and disability insurance. Perhaps in anticipation of using furloughs again, employers are revising their benefits policies to ensure employees don’t lose benefit eligibility because of reduced hours. Any reduction in pay means you will be contributing less to your employer’s savings plan and therefore receiving reduced matching from your employer.

On the question of whether or not you can draw on your accrued sick or vacation time, the answer will depend on your employer’s policy. Some employers permit the use of accrued paid time off, and others won’t allow it. It’s the employer’s call. It’s also likely the furlough will not reduce your credited service time.