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Unemployment Insurance Benefits

Find information on how unemployment insurance benefits work.

Eligibility for unemployment insurance benefits vary according to state requirements. [©Jupiter Images, 2009]
©Jupiter Images, 2009
Eligibility for unemployment insurance benefits vary according to state requirements.

Unemployment insurance benefits are available through the Federal-State Unemployment Insurance Program. This program allows unemployed workers adequate time to find new employment without applying for welfare benefits or settling for a job for which they are overqualified. The federal government establishes a few basic criteria for disseminating the benefits, while state governments set eligibility requirements, benefit levels and length of paid benefits. According to the United States Department of Labor, the money for unemployment benefits is primarily raised by taxing employers, with only three states requiring employee contributions to receive unemployment benefits.

Unemployment Insurance Benefits Overview

Coverage varies between states, but the National Center for Children in Poverty, estimates an average of 35 percent of unemployed workers receive unemployment benefits. The amount an employee receives in unemployment benefits depends on the employee's salary while employed. Most states use the employee's salary during a recent 52-week period to determine benefits, which normally equals less than half of the employee's salary. Most states pay benefits for up to 26 weeks; however, the limit can be extended in times of great need.

Qualifying for Unemployment Insurance Benefits

While eligibility for unemployment benefits varies from state to state, there are a few basic requirements employees must meet in all states. Employees are required to meet a certain amount of time worked and money earned. In most states, an employee must have been employed by the most recent employer for four of the last five completed calendar quarters to file a claim.

Employees must also become unemployed through no fault of their own, as determined by state law, such as due to a layoff. According to the American Association of Retired Persons (AARP), the following types of workers may not be eligible for unemployment benefits:

Employees who quit their jobs, although in some states, employees who quit a job with good cause or who quit to aid an ill family member may still be eligible

  • Independent contractors and workers paid solely by commission
  • Employees who are dismissed for willful misconduct
  • Employees who are dismissed for violating a company rule
  • Part-time employees, although some may be eligible even if they have another part-time job

Unemployed workers must be able to perform the functions of their old job or similar jobs, be willing to work, and be actively searching for new employment. Unemployed workers may be required to register with a state employment service, which will help them find employment. The state employment service helps unemployed workers find job openings and training programs, and assists with testing and counseling to determine qualifications for employment. The employment service can also refer unemployed workers with special needs and considerations to agencies that can help them with their needs.

Applying for Unemployment Insurance Benefits

To file a claim for unemployment benefits, unemployed workers must contact the unemployment insurance agency in the state where they were previously employed. Contact information for the agency in each state is available at the CareerOneStop Web site, sponsored by the U.S. Department of Labor .

A claim may be filed at the unemployment insurance agency office. In some states, claims may be filed over the phone or online. Applicants may need to provide addresses and phone numbers for their former employer, dates of employment, pay stubs or W-2 forms, their social security card and, if available, documentation explaining their unemployment, such as a letter from a former manager.

The first unemployment benefits are usually available two to three weeks after a claim is filed. Some states require a one-week waiting period after employment is terminated before benefits start accumulating. Once approved, applicants will receive benefits for their entire period of unemployment, less the one-week waiting period required by some states .

Renewing Unemployment Insurance Benefits

In order to continue receiving unemployment benefits, unemployed workers must continue to file weekly or bi-weekly claims. Unemployed workers will be asked to report any money earned or job offers. These claims can usually be submitted by phone or by mail. Unemployed workers may also have to sign documents stating they continue to meet unemployment benefit requirements, apply for a set minimum number of jobs and accept a job equivalent or better than their previous job if one is offered.

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