Benefits of Unemployment

[Kalyan]

Unemployment Benefits

The unemployment insurance system was initiated in the Social Security Act of 1935. Although there are Federal guidelines, each state is allowed to enact unemployment laws and set its own related rules within the guidelines.

Subsequently, unemployment benefits and eligibility requirements vary by state.

Unemployment Benefits Eligibility

To be eligible for state unemployment benefits, you must meet your work state's requirements for wages earned and time worked during a predetermined period of time, called your base period. In many states, the base period is the first four calendar quarters out of the last five, prior to the time an unemployed worker applies for benefits.

In other words, you must have been "substantially" employed, as deemed by the unemployment laws in your work state. But even if you didn't work for consecutive weeks, for the same employer, or in the same state, you still might be eligible for unemployment benefits.

The same goes if you didn't earn much. But your wages will determine your unemployment pay and you must have earned at least a minimum amount during your base period. There's more about that on the next page.

You must also meet other state eligibility requirements to collect unemployment benefits. Again, eligibility requirements vary by state; but, generally:

Losing your job can't be your fault

If you get laid off, then you're likely eligible for state unemployment benefits. But if you get fired or quit, you might not be eligible. For example, if you get fired for gross misconduct or failing a drug test, you might not have a leg to stand on. But if you quit for "good cause" in legal jargon, then you've still got a shot at it. Your state's unemployment laws might allow you to quit for personal reasons, too.

You must be ready, willing and able to work

For example, if you quit because of a non-occupational, disabling illness or if you become disabled while unemployed, you're not likely to be eligible for state unemployment benefits. Instead, you might be eligible for state or Social Security disability benefits. If you become unemployed due to a disabling occupational illness or injury, then you're likely eligible for workers' compensation.

You must actively seek work

To receive each unemployment benefit check, you'll probably have to regularly report that you are actively job searching and at which companies; but simply submitting your resume to job banks might do. You might not have to seek work if you are starting up a business while collecting unemployment benefits. (See the self-employed info below.)

You can't refuse to take a job for which you qualify. For example, you might lose your eligibility for unemployment benefits, if you refuse a job offer simply because you didn't like the interviewer. But your state unemployment office likely won't force you to take a job that's way below your qualifications and previous earnings.

You can't attend school full time.

But, if you can show that you are seeking a job for which you are qualified and can work it outside of school hours, you might get an exception. Training provided as an unemployment insurance benefit will be exempt from this rule.

You can't be employed full time

Natch, if you land a full-time job, your unemployment benefits will stop. But, you might be able to work part time and still collect benefits. More about that is on the next page.

You can't receive money from a former employer

If a former employer owes you money, your state might delay your unemployment pay. For example, if your employer gives you advanced layoff notice as required by the Feds or your state, then escorts you out the door soon after, you probably won't be eligible to collect unemployment benefits until after your notice period expires. That's because you're still employed and receiving employment pay through your notice period, even though you don't have to show up for work.

Your state might also delay your unemployment pay if you are to receive severance pay or already have (depending on its purpose per unemployment laws). The same goes for pension payments or accrued vacation or sick pay. However, even if your employer owes you money, you likely may apply for unemployment benefits anyway to get the ball rolling.

You can't have been self-employed full time

You typically won't be eligible for unemployment benefits if you were self-employed and lost your income (unless you bought unemployment insurance). However, if you were self-employed while also working as an employee and you lost your employee job, then you might be eligible.

You might also be eligible if you were an employee and are attempting to become self-employed because you lost your job. Some unemployment offices will help unemployed workers become self-employed, through special programs.

You can't collect unemployment benefits from more than one state at a time

You likely won't be eligible for unemployment benefits if you are already receiving them from another state. But you might be eligible to collect the difference, if one state pays more than the other and you've worked in both states.