The following are some of the questions we have been asked over the last few months by clients and prospective clients.  Feel free to contact us with your questions and we will work with you to find the answers.

Who is charged for a UI claim?

States differ in how they determine who is chargeable for an unemployment claim. Some states charge the most recent employer for all benefits, while other states charge employers in proportion to the wages they paid during a base period. States may also charge the most recent employer first, and then any prior employers pay a share of the claim in inverse order. In some states employers can offset unemployment benefit charges through voluntary contributions to the unemployment fund.  So, the answer ultimately is “it depends”.

How does the state determine the benefit amount to be paid? Does it depend on how much we paid the employee?

The weekly benefit amount is based on past earnings. The benefit amount is based on the claimant’s usual wage and is generally about 50 percent of wages. Every state has a maximum weekly benefit amount, and some states are significantly higher than others. A claimant who earned higher wages will usually receive benefits that are less than 50 percent wage replacement.

Can someone be working and collecting wages at the same time they are collecting unemployment?

Yes, it is possible to collect unemployment benefits while working and earning at a certain level. Most states pay unemployment benefits when a claimant is partially employed, however the claimant’s wages reduce their UI benefits paid.

If someone quits can they collect unemployment?

When an employee quits and then files a claim for unemployment, then the former employee has the burden of proof to demonstrate that they quit for a valid reason, with good cause attributable to the employer.  There are situations in which an former employee can collect UI benefits even when they quit, but they have to show a significant change to the conditions of employment or a serious issue attributable to the employer (safety issues or health issues) – where the employer refuses to address it.

Are part-time or on-call employees eligible for unemployment? Are they potentially eligible for unemployment?

An employee is eligible to collect benefits for any week they did not work and did not receive wages and part time employees who earn enough money can be eligible to file a claim for benefits.

Are temporary employees eligible for unemployment?

A temporary employee can be eligible to collect unemployment when an assignment ends. This can happen even when it is understood at the time of hire that the position is temporary.  Generally speaking, it is the temporary agency who is chargeable for the unemployment costs.  However, bear in mind that if you have employees that you hire from the temporary agency, you will become liable for the charges if a layoff or separation occurs in which the claimant files for benefits.

How are unemployment tax rates determined?

Unemployment tax rates are generally based on payroll and “experience” (how well you manage your UI claims and costs). States vary on how long an employer’s experience will affect unemployment tax rates.

Is my unemployment rate high or low?

The rate often depends on the industry, economy, location and a number of other factors. The important thing is to work to bring the rate down. When an employer’s rate is reduced from 9 to 7 percent, or from 3 to 1 percent, the employer saves the same amount of money.