It can be a hassle to file a claim, and you may feel a twinge of embarrassment, but get over it. This benefit can help you stay financially secure during your job search.
After losing a job, unemployment benefits can be essential to staying financially solvent. But not everyone gets to pick up a paycheck.
Whether you get benefits is determined by state unemployment compensation law, says Lori B. Rassas, author of The Perpetual Paycheck: 5 Secrets to Getting a Job, Keeping a Job, and Earning Income for Life in the Loyalty-Free Workplace. The rules vary from state to state. To check the program laws in your state, go to the U.S. Department of Labor's CareerOneStop website and click on your state for general information and to file a claim.
Here are 11 situations that might disqualify you from collecting benefits or reduce the amount you receive.
1. You didn't work enough or earn enough to qualify.
Your eligibility depends on how long you held your job, among other things. Your state's unemployment office will review your work history, typically looking back 15 months from the day you file an unemployment claim. It will review your earnings in the earliest four of the last five completed three-month periods, or quarters. As long as the sum you earned meets your state's minimum requirements for earnings, you're generally entitled to unemployment benefits.
The specific number of weeks you can receive benefits and the amounts paid vary by state, says employment attorney Donna Ballman, author of Stand Up for Yourself Without Getting Fired: Resolve Workplace Crises Before You Quit, Get Axed, or Sue the Bastards. In most states, you can get up to 26 weeks of benefits. That said, the number of weeks can range from a low of 12 weeks in North Carolina to a high of 30 weeks in Massachusetts. The weekly maximum amounts range from $235 in Mississippi to $698 in Massachusetts. Extended benefits through the federal government may be available during periods of high unemployment once you use up your state's benefits.
Keep in mind that your unemployment benefits are taxable by the federal government and most states. You can decide to have taxes automatically deducted from your payments or pay taxes later.
2. It was your fault you lost your job.
The general rule is that you're entitled to unemployment benefits if you become unemployed through no fault of your own. If you've been laid off or downsized in a company restructuring, you will generally qualify. "If you report to work every day and satisfactorily complete your job responsibilities, but your job goes away and you're laid off due to lack of work, this is not your fault and therefore you would likely be entitled to unemployment benefits," Rassas says.
What is considered your fault and not your fault, however, can differ from state to state. Violating certain company rules may be enough to disqualify you depending on the nature of the conduct. "Generally speaking, if you're terminated for serious misconduct, such as committing a crime or threatening your supervisor with bodily harm, this will likely be considered your fault and would disqualify you from benefits," she adds.
3. You quit.
"Different states have different standards, but quitting without cause will almost always get you disqualified," Ballman says.
If you quit and want to qualify for benefits, you'll usually have to prove you quit due to something that is the fault of the employer. "Good examples would be cutting your wages, requiring you to move to a different location, a demotion, or something illegal like discrimination or sexual harassment," she says.
There are simply times you have to quit, Ballman says. "For instance, if your employer is violating OSHA [Occupational Safety & Health Administration] standards and puts you in an unsafe situation, or if your supervisor or coworker physically attacks or threatens to attack you and the company won't fire them or move them so you are safe," she says.
4. You're still getting paid.
Severance pay, unused vacation pay, workers' compensation or pension payouts can potentially block unemployment benefits for a certain time while you're receiving that income. It generally depends on the type of payout you're receiving and the amount.
5. You receive Social Security benefits.
The Social Security Administration does not count unemployment benefits as earnings, so the unemployment benefit will not affect your Social Security benefit. However, income from Social Security may reduce your unemployment compensation. Contact your state unemployment office for information on how your state applies the reduction.
6. You weren't officially an employee.
Your employer may have classified you as a contractor, which would generally make you ineligible for the benefit. But that doesn't mean they were correct to label you a contractor, Ballman says. "If you think you are misclassified, go ahead and apply and let your unemployment agency know why you think you're really an employee."
Fill out Form SS-8 (Determination of Worker Status for Purposes of Federal Employment Taxes and Income Tax Withholding) with the IRS to request a "worker status" determination and to establish if the services you provided to the firm were those of an employee or an independent contractor. "If they determine you were really an employee, you may be able to recover your former employer's share of employment taxes," Ballman advises.
7. You aren't seriously looking for a job.
"You'll be disqualified if you don't jump through all the hoops your state requires to show you're actively looking for a job," Ballman says.
In general, that means demonstrating that you meet a certain quota of job-related contacts each week. These activities may include using employment resources available at the local career center, such as meeting with career center advisers, submitting job applications and résumés to employers, attending job search seminars to improve your job-hunting skills, attending job fairs or interviewing with potential employers.
If you can't make the quota, your state may require you to contact your local office and explain why. If you were sick, you might need a doctor's note.
See also: The road to reemployment
Documentation tip: If you send a résumé or application by email, save a printed copy of all correspondence. Also keep for your records a list of jobs you apply for in case your state asks for proof that you have been looking.
If you travel outside your state, you'd better be able to show that you were still job-hunting while gone and that you were close enough to return if a position was offered and you needed to start immediately.
You can also be disqualified if you turn down an equivalent job to the one you lost. "So don't think of your unemployment compensation as a paid vacation," Ballman says.
8. You work part time.
Most state laws require you to be available to job-hunt and work full time if a position is offered. One reason for putting the kibosh on benefits when you're bringing home income from another source is that if you're working a contract, freelance or part-time job, you're presumably not available to work full time if you're offered a job.
Some states deduct what you earn from your benefit, dollar for dollar, while other states permit you to earn up to 25 percent of your benefit before they reduce your unemployment checks. If your job is temporary, you may not receive an unemployment check while you're working. But once the work ends, you may be able to resume collecting benefits.
Before taking any freelance assignment or part-time job, read your state's unemployment insurance rules. If you do work part time and collect partial benefits, be precise in reporting any income. If you make an error in the amount, your benefit checks may be cut off. It's hard to hide income, since most employers will report to the IRS any payouts they make.
9. You volunteer.
The red flag is anything that will take time away from your job search. For volunteer work not to disrupt your benefits in some states, you must be able to prove that the volunteer work doesn't interfere with your ability to job-search or with the days and hours you would be required to work if hired.
10. You go back to school for training.
Believe it or not, you might be disqualified if you're attending school or college, or training full time without the approval of your state's unemployment office. If your training or schooling takes place during evening hours only or solely on weekends, then this does not affect your ability to work a daytime job — so you may receive benefits.
11. You start your own business.
Your benefit may also be reduced or discontinued if you become self-employed, even if you're not paying yourself a salary yet.
Parting advice: Swallow your pride, push through the red tape and sign up for your benefits — then tackle your job search as a full-time job.
Kerry Hannon is a career transition expert and an award-winning author. Her latest book is Getting the Job You Want After 50 for Dummies. She has also written Love Your Job: The New Rules for Career Happiness and Great Jobs for Everyone 50+: Finding Work That Keeps You Happy and Healthy … and Pays the Bills. Find more from her at Kerryhannon.com.
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