Losing your job is scary. One way to alleviate some of the economic stress after losing your job search is to collect unemployment.
Unfortunately, many workers don't take advantage of the program when they need it most. In 2016, only 27 percent of unemployed workers received unemployment benefits. But why?
"Some people just don't understand their rights, and they should definitely investigate," according to Michele Evermore, a senior policy analyst at the National Employment Law Project. "Do what you can to get these benefits that you're entitled to."
What is the Purpose of Unemployment Benefits?
According to Evermore, there are at least three reasons unemployment benefits exist:
- The government doesn't want people to suffer because they've lost a job through no fault of their own, Evermore says. Unemployment is designed to alleviate that immediate suffering for an unemployed person and their family.
- Additionally, Evermore says, the government designed our system of unemployment benefits in a way that keeps people attached to the workforce after they've lost employment. "In most states, there's some sort of work search requirement and some expectation that people are out looking every week," Evermore says, and if they find a "suitable" job, they're expected to take it.
- Some policy experts believe unemployment benefits stimulate the economy. The idea being that when something bad happens macroeconomically—a recession or depression—people struggling financially will still have money to spend.
When Is The Right Time File?
"Immediately after being laid off," Evermore says. The unemployment office will want to know what happened on your last day of work, so you should pay them a visit while the details are still fresh in your mind.
Filing right away is important for another reason – it takes a while for unemployment to become active and for the money to begin flowing in. The federal government says it'll be two or three weeks until you see your first check.
"Even if you've gotten notice, even if you're getting severance, even if you might get paid vacation, go ahead and file," Evermore says. Some states allow you to receive severance alongside unemployment.
Are Unemployment Rules the Same in Every State?
The short answer is no. Even key functions of unemployment benefits differ from state to state. Below are some of the differences:
1. The amount you'll receive. Unemployment is calculated using a base period. In most states, a base period is the first four quarters of the most recent five quarters of employment. The state of New York devises your unemployment benefit sum by dividing your earnings for the highest paid quarter of the base period by 26, and you can receive no more than $420 per week.
In Indiana, your weekly benefit rate is 47 percent of your weekly wage during the base period, with a minimum weekly payment of $50 and a maximum of $390.
2. The length of time you receive benefits. Most states provided 26 weeks of unemployment benefits. There are several notable exceptions, however. Missouri provides only 13 weeks. Arkansas, Michigan and South Carolina provide 20 weeks. Montana provides 28. Massachusetts provides up to 30 weeks. Five other states periodically change the duration of unemployment benefits depending on the state's unemployment rate.
3. Varying job search requirements. In Florida, you must make a minimum of two job contacts per week, which includes filling out applications and sending resumes. In Arizona, on the other hand, you must "engage in a systematic and sustained effort to obtain work" during at least four days of the week and make at least one job contact each day.
4. Training programs. Many states, such as Washington, have work training programs that have been approved by the state. In some cases, this can be attended instead of meeting job search requirements each week.
5. Types of employment covered. The occupations eligible for unemployment benefits vary by state. In some states, for example, real estate agents who work on commissions exclusively are not eligible. Some states exclude taxi drivers, while others don't extend benefits to nail technicians. Call your state's unemployment office to know whether your occupation is covered.
What Can I Do if an Employer Denies My Benefits?
Sometimes an employer will deny an ex-employees' application. It's in their interest to have fewer employees on unemployment because the state charges an employer a fee based on the number of their employees who utilize the service. There are many reasons they might deny you.
Christopher J. O'Leary, a senior economist at the Upjohn Institute, says violation of workplace rules is most often cited in denials.
"Such rules vary from employer to employer but must be stated in advance and understood by employees," O'Leary says.
The following are frequently-cited reasons:
- Excessive unexcused absences;
- Excessive tardiness;
- Failure to comply with the dress code;
- Inadequate performance of job duties;
- Smoking in no-smoking areas;
- Drinking or being drunk on the job;
- Inappropriate interactions with co-workers;
- Verbal harassment;
- Sexual harassment;
- Failure to have a required driver's license;
- Lied on a job application about credentials;
- Theft; and Vandalism.
How do You Fight Back if You Are Denied?
Hold onto any paperwork relating to the layoff, Evermore says, though disputes are often more complicated than that, requiring additional evidence.
"You'd want to keep records of anything that relates to your cause of leaving the job," she said. "For example, in some states harassment is good cause to quit, so if that's why you're leaving, retain any documents that back up that claim."
Additionally, she suggests, write down any relevant conversations you had preceding the layoff. You never know if it'll come in handy.
If you've been denied, the next step is filing an appeal. Every state has an appeals process. Sometimes, Evermore says, those who applied on the computer may get denied for a reason the computer system didn't tell you. It's best to follow up with the agency over the phone to learn exactly what happened.
Next, the adjudication section of the state agency will set a hearing. In most states, an applicant can choose to have a hearing either in person or by telephone. Bring documentation proving your employment ended through no fault of your own. Your employer will likely send someone from HR or another expert to the hearing. Some states have an unemployment advocates program that offers free help with your appeal. If your appeal is denied, you can appeal to a state administrative law judge. Yet another appeal would bring your case to the courts.
Always keep in mind you're not alone. "In general, the state workforce agency people that I've talked to really do want to make sure that people get their earned benefits when due," Evermore says, "so they're there to help you."