Unemployment insurance, more commonly known as unemployment benefits or simply unemployment, is a type of payment that is primarily made by state government agencies to people who are unemployed.

Although the U.S. Department of Labor and federal laws both mandate and help to govern unemployment insurance programs, such payments are generally funded by payroll taxes that are collected in a state and are set aside for that specific purpose.

In fact, each state is required to create an unemployment insurance plan in accordance with federal law. So, while many states may adjust rates and change some qualification factors, the majority of programs correspond with guidelines provided by federal law. However, the policies enacted within a particular state may vary by jurisdiction.

For example, a person who is eligible for unemployment insurance in New York may receive $504 per week, whereas a person who is eligible for unemployment insurance in Massachusetts can receive up to $742 per week. As a side note, Massachusetts happens to have the highest unemployment insurance rate in the nation.

Additionally, it is important to note that unemployment benefits can only be distributed in certain situations. For instance, people who are fired for cause, are self-employed, or who voluntarily quit their job, will not be eligible to collect unemployment benefits.

Instead, unemployment insurance is only available to persons who meet the conditions or requirements of their state’s program and have lost their job due to reasons that are out of their control.

As an example, a person who is forced to leave their job due to medical reasons may be able to file a claim for unemployment benefits if they meet their state’s threshold and their application is approved by the state government agency running the program.

To determine whether you qualify for unemployment insurance in your state, you should visit your state’s website and/or speak to a local employment attorney for further guidance.

Who Is Eligible for Unemployment Insurance?

As discussed above, each state has its own requirements for collecting unemployment insurance. In general, some factors that tend to apply across the board include the following:

  • The worker must have been employed by a business that pays unemployment insurance;
  • The worker must have earned a certain amount of income or worked for a specific period of time (note that this criteria will be set by the state);
  • The worker must not have been terminated for cause or be the reason that they are no longer employed;
  • The worker must not be an independent contractor or self-employed (though this rule has temporarily changed under the recently enacted CARES Act of 2020); and
  • The worker must report any income they receive while collecting unemployment benefits, must fill out a weekly worksheet proving they applied for jobs, and cannot refuse to work if they get an offer.

What Are the Steps to File for Unemployment Insurance?

The overall process and individual steps for filing a claim for unemployment insurance will largely depend on the policies enacted in a particular state. As such, these will vary widely and will be based on different tax rates within a state.

Also, due to the pandemic, the federal government was forced to enact the CARES Act of 2020. Thus, there are several new and significant requirements that are pandemic-related and may be subject to change in the near future.

In general, a person must at least satisfy the two main requirements to even be eligible to file a claim for unemployment. These include that:

  • The person meets their state criteria for time worked or for wages earned within a certain time frame; and
  • The person is unemployed through no fault of their own (e.g., they developed a serious illness or were laid off because their company ran out of work to give them).

Once an unemployed individual determines that they meet both of these requirements, they should immediately visit their state’s website for unemployment insurance to read more about additional requirements. One other important factor that often shows up in states’ policies is that the individual must be able, available, and actively looking for work.

After reviewing and satisfying all of their state’s requirements, the unemployed individual will need to complete an application for unemployment benefits. This can usually be found on the same website and will ask for information, such as past job history, the reason they lost the job they are trying to claim unemployment insurance benefits from, contact information (e.g., address, phone number, etc.), social security number, and possibly, their bank account number.

When the application for unemployment benefits is complete, the individual can submit it via their state’s online portal or through whichever method their state has chosen to accept applications.

What Happens after a Claim Has Been Filed?

After a claim for unemployment insurance has been filed, then the applicant must wait for the state agency to approve them. This can take up to two to three weeks to receive a decision. If the application is approved, the applicant can expect to receive their first check once they get the decision. States may either send checks through the mail or deposit money directly into an applicant’s bank account.

The average approved applicant will receive an amount that is equal to approximately half of what they typically earn at their job for up to about twenty-six weeks. In some cases, if the individual cannot find a job within this time frame, they may be able to request an extension.

In addition, while every state has its own requirements, all of them ask that the individual submit a weekly worksheet that proves they have been looking for a new job each week. This worksheet usually resembles a document that looks like a book log or excel spreadsheet.

Lastly, as previously mentioned, the individual must also not refuse any job offers they receive within this period and must report any income they earn from freelance or spontaneous gigs. Failure to comply with these requirements may bar the individual from collecting the remainder of their unemployment benefits.

Defending Against Unemployment Claims

An employer may be able to prevent a former employee from obtaining unemployment insurance benefits. They may do this by submitting a claim that states an employee is ineligible due to specific reasons like the employer actually fired them.

Some defenses that may be available to an employer and could potentially lead to a successful result include the following:

  • If an employee voluntarily left the company without good cause (e.g., they quit because they were bored);
  • They were fired for cause;
  • The employee violated a law or company policy, which then led to their termination (e.g., consumed drugs while on the job or intentionally hurt a co-worker); and/or
  • They are excessively absent or tardy for no reason and without permission from the employer.

In other words, if an employer can genuinely show that a worker was responsible for the reason they lost their job, it will most likely prevent the worker from being eligible for unemployment insurance.

What Can I Do If I Am Found Ineligible for Unemployment Insurance?

If an unemployed individual is determined to be ineligible for unemployment insurance, they will have a certain amount of days to file an appeal. Each state will provide instructions on how to file an appeal and how quickly an appeal must be made after an initial denial. If their appeal is denied as well, they may be able to attend an administrative hearing before their state board to plead their case.

A person who is denied unemployment insurance should contact a local lawyer for unemployment benefits assistance. Lawyers with this type of experience will be able to explain why a claim was denied, can help fix and file a claim for an appeal, and can discuss other options. Additionally, a lawyer can also provide representation in front of a state board or in court should it be necessary.

Do I Need a Lawyer Specializing in Unemployment Insurance?

You do not need to hire a lawyer in order to file a claim for unemployment insurance. However, it may be in your best interest to consult a local employment lawyer if you need to extend your unemployment insurance benefits or if your claim is denied. An experienced employment lawyer will already be familiar with the employment laws and procedures that apply in your state, and can walk you through the next steps.

In addition, your lawyer can also help you fill out any necessary paperwork, can answer questions you may have about your claim or unemployment insurance in general, and can represent you at an administrative hearing or in court if necessary.