How do Unemployment Benefits Work

Unemployment is a harrowing thing, and can be terrifying you are laid off with little warning and no concrete prospects elsewhere. In today’s economy, this is a very real threat, and many people who never had to apply for unemployment benefits (also known as unemployment compensation) have to do so now. Despite how daunting or discouraging the task may seem, it should be seen as a good thing, a way for you to get back on your feet and help yourself out of a dismal position. The true question is how exactly does the whole system work?

Unemployment benefits refer to a means of providing workers who are unemployed by no fault of their own with monetary payments. These payments can be provided for a limited amount of time or until the person finds alternative employment, as determined by state law. State law also determines eligibility and the amount paid to the worker. It is as a result of the 1935 Social Security Act which created the federal-state Unemployment Compensation (UC) program in order to assist people who had become suddenly jobless and provide basic necessities until they could find employment.

The first rule when seeking unemployment benefits is to know that every state is different and that one must contact their local unemployment office or labour department for exact details on how the system works in that particular state. Beyond that however, the worker must first apply at the local unemployment office and complete an application detailing their mailing address (including zip code), Social Security Number, Alien Registration Card if not a US citizen, phone number, names, addresses and dates of employment for all your past employers for the last two years and so on. The unemployment office will then do some research to determine whether the worker is eligible, as well as how much money the worker would be eligible for.

Eligibility is determined by a number of factors. The first and most prevalent is that the worker is out of a job for a good reason. “A good reason” is admittedly rather vague, and varies in its meaning from state to state, but basically a worker must have been fired or otherwise discharged by no fault of their own, or, if the worker quit, there must be a very, very good reason. Generally speaking, quitting will not often result in unemployment benefits, though there can be exceptions, such as dangerous working conditions or discrimination and harassment. It should be noted however that if a worker is discharged due to misconduct, her/she may not qualify for unemployment benefits. There will be other factor affecting eligibility, but these will most likely be determined by the particular state. Generally speaking however, a worker may not qualify if they: are attending school, quit to get married, quit without good cause, are self-employed, are involved in a labour dispute or was involved in a strike, and finally are unable to work or  are not looking for employment.

The unemployment office then contacts the employer to get their side of the story. If both employer and worker’s stories match up, then the decision is left to the unemployment office to determine if benefits will be provided. If there is a discrepancy, then the worker will be contacted to verify, and may potentially involve a meeting or conference between the employer, worker and unemployment office to resolve the issue. If it turns out that the worker was not deemed eligible for benefits, the worker can appeal this decision in court, and may have a judge rule in their favour, depending of course, on the circumstances. Likewise, an employer can appeal a decision to provide a worker with benefits. Employers will tend to try very hard to prevent unemployment benefits from being paid, because it will raise the insurance premium the company is required to pay, as employers pay federal unemployment taxes to cover the costs of administering the UC programs in all states.

If the worker is deemed eligible, they receive their first check about three weeks after being accepted and continue to be received every two weeks after. He/she then has to re-file a claim each week for the remainder of the period she is unemployed, along with proof employment is being actively searched for in some cases. If the worker quits re-filing claims (whether because of accepting a job or their own volition) then checks will no longer be sent to the worker. The worker will likely receive benefits for a maximum of 26 weeks, though this varies by state, with compensation also varying by state, though generally one can expect to receive half their typical earnings from their previous job.

If you so happen to be in the unfortunate situation of being unemployed until your unemployment benefits run out, here are some places you can get help. 

Unemployment is no joke, and can be very trying if it occurs suddenly. Luckily, unemployment benefits exist as a means of alleviating some of this stress and helping people get back on their feet. Though the process may seem to take forever and may have many unsavoury twists and turns especially if you have to take the matter to court, it is all for the greater good, and serves as a temporary foothold on the hopefully short climb back up to employment and self-sufficiency.

For your convenience, Here is an A-Z list of all state the Unemployment Offices. Each individual state may have their own rules as to unemployment benefits, so it pays to have the numbers on hand in an emergency, so unemployment benefit can be filed for as soon as possible.