Unemployment Insurance Benefits Explained
The ordinary worker normally relies from their wages for their daily grind. Chances are when these workers suddenly lost their means of living; they have no more left for themselves but savings that normally dries up as bills continue piling up.
In today’s hard times, unemployed workers mostly end up broke before they could even find a suitable job. This is where the government comes in for the rescue through the aid of Unemployment Insurance (UI) benefits.
Unemployment Insurance (UI) benefits are temporary aid provided by the local unemployment agency to its jobless citizens who were out of work through no fault of their own. This unemployment compensation is used to offset the amount of wages lost during the period of unemployment until the worker finds suitable employment.
The funds that are used to compensate the unemployed were taken from the Unemployment Insurance (UI) taxes that are paid for by their employers under the Federal Unemployment Tax Act (FUTA) which authorizes the Internal Revenue Service (IRS) to collect an annual federal employer tax which will be used to fund state workforce agencies. The Federal Unemployment Tax Act (FUTA) will then cover the costs of administering the Unemployment Insurance Job Service programs in all states.
This means, that no money is being taken from the workers salaries. If an employee’s employer is paying unemployment tax, such is called covered employment and after some tenure at work, the employee may collect unemployment benefits provided that eligibility requirements are met.
There is another type of employment that does not entitle a worker from receiving unemployment benefits and that is called uncovered employment and such are the workers of non-profit institutions. These organizations are not covered by unemployment tax law therefore they don’t pay unemployment tax which is used to fund unemployment benefits.
Unemployment Benefits Eligibility
There are certain requirements that each state requires for applicants in order to receive unemployment benefits however in most cases, they are mostly the same in scope. Self-employed individuals are automatically disqualified from receiving unemployment benefits. Partially employed or those that had been working in reduced hours than normal whose earnings as well have been reduced as a result may be eligible. Totally unemployed workers can initially apply for unemployment insurance benefits but this doesn’t mean that they are automatically eligible and can receive benefits because the reason for separation is normally looked upon and investigated by the unemployment office.
The cause of unemployment must be favorable and should not be a result of misconduct or improper behavior or insubordination.
Other than having a graceful exit from work, tenure from work is also looked upon to determine monetary eligibility which means, an applicant for unemployment insurance must have accumulated paid wages under covered employment which is normally computed as the base period or the fourth of the last five quarters of the calendar year at the time of filing.
Each state uses this same principle but may differ in terms of qualified wages earned as an eligibility requirement. Once monetary eligibility is established, the applicant can now file for unemployment benefits then other criteria will follow before unemployment compensation is released.
Unemployment Insurance Benefits Application Process
It normally takes two weeks before unemployment compensation begins with the first week being the waiting period which is not paid retroactively and the second being the time lag between eligibility for the program and the first actual payment.
Claims normally start through filing at a local unemployment office or online through the states’ unemployment office website when available.
Eligibility of claims are normally determined first, by monetary eligibility or the length of tenure and wages paid under covered employment, second, the reason for separation from work, and lastly, the availability to accept work at any time when required, the ability to do the work meaning physical and mental condition must not hinder an applicant from taking work, and the last important thing is that the claimant must be actively seeking work.
Passing these requirements does not end after receiving your first unemployment compensation pay because a claimant must determine eligibility each week in order to get continuous benefits.
Unemployment Insurance recipients must disclose all earnings they receive each week and must register with the unemployment office’s reemployment services and trainings when required and must not refuse job offers for no compelling reason, otherwise benefits will be denied.
These are just some of the basic details about Unemployment Insurance (UI) benefits that would serve as a guide to unemployed workers out there who badly needs a lift.
For more updates and to take advantage of our free ebook in surviving the challenges of being unemployed, simply fill-out the form on the upper right hand corner of this page.