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by Michael Giusti | April 20, 2020

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In the past few weeks, millions of hardworking Americans have had to take an unfamiliar (and in most cases, virtual) stroll into the unemployment office following the shelter in place orders given to slow the spread of COVID-19. If you’ve never gone through the process of filing for unemployment, there are some terms and technicalities worth wrapping your head around so that you can end up with a weekly check to tide you over until your next job.

What is unemployment insurance?

Each state has its own unemployment program, but they follow the federal guidelines set by the Department of Labor in a joint federal-state program. Every program offers pay for people who are no longer working through no fault of their own, which is an important distinction to make. Each state has a law dictating what constitutes a job loss that wasn’t your fault. For example, if you were laid off because there was no more work to do, you are probably entitled to an unemployment check. Conversely, if you were fired for cause — say you were skimming money from the till — you will almost certainly be ineligible for unemployment payments.

How much do you get from unemployment insurance?

How much you will get each week is based on how much you were earning before your unemployment began and, contrary to common belief, not based on need. They don’t care how much you need to pay your bills. They care about how much you made before you were let go. That is because your employer was paying into the state unemployment fund each month based on how much you and all your coworkers earned. Higher pay means more tax, which means more in the pot for you.

Your state will have a formula to average your earnings over the previous year or so, excluding the time you became unemployed. That is called the “base period,” and it typically covers the first four of the previous five calendar quarters before you were let go.

Regardless of how much you were earning before your unemployment began, each state has a cap for how much you can claim each week. So, for example, in Louisiana, which has one of the most restrictive unemployment systems in the country, the biggest benefit you can claim is $247 per week, regardless of how much you were earning before. Washington State, on the other hand, offers a maximum weekly benefit of $790 per week. Most states fall somewhere in the middle. Those weekly payments are taxable income, so plan appropriately.

If you live in one state but worked in another—say, for example, you worked from home and your employer was across the country–typically, you would file your claim in the office closest to where you live. The unemployment staff will work with you on how to make the claim against your employer’s state, but definitely start closest to home.

Unemployment & Coronavirus: The CARES Act.

In normal times, states typically require that you are actively searching for work in order to continue to receive benefits. That has changed slightly since Congress passed the Coronavirus Aid, Relief, and Economic Security (CARES) Act.

Under the CARES Act, the federal government has temporarily changed many of the rules regarding unemployment. Waiving the requirement that you are looking for work is one big change they have made, but they have also made it so states can choose to pay unemployment benefits:

  • If an employer temporarily closes due to the COVID-19 outbreak
  • If an individual is quarantined and expects to return to work later
  • If someone leaves a job because of the risk of contracting COVID-19
  • If someone has to leave a job to take care of a family member

Federal law also now doesn’t require employees to quit their jobs in order to receive benefits due to the impact of COVID-19—merely certify that they can no longer work.

But again, state rules may have different regulations than the federal guidelines, and each state has some leeway in what guidelines they are going to apply.

The CARES Act made another huge change to unemployment insurance—namely, it authorized federally funded weekly payments of $600 in addition to what the state was already going to pay. So, in our example of Louisiana, that maximum weekly payment jumps to $847.

Rest assured, though, that the extra income is not supposed to count against you when it comes to calculating eligibility for programs like Medicaid or the Children’s Health Insurance Plan.

The law also extended the number of weeks you can be eligible for payments up to a maximum of 39 weeks, and it opened up unemployment benefits to workers who would otherwise be ineligible for payments before, such as freelance workers, self-employed people, or gig workers who were not paying into the unemployment fund to begin with.

Still, you have to show that you were doing work of some kind that you can no longer do now in order to get a payment. So, if you can work from home by phone or computer, you need not apply for unemployment.

As soon as you become unemployed, you should reach out to your state unemployment office. Most states have web portals or telephone numbers for you to do this while practicing social distancing.

In general, you will need to have the address and dates of employment for everyone you have worked for over the past 18 months, as well as how much you earned at each job.

Be patient. In normal times, it can take two to three weeks before you receive your first payment. Now that state offices are overrun, it is looking like payments may take much longer.

At the end of each week that you are getting payments, you will need to recertify that you still need the unemployment benefits. You will need to report any money you earned that week and whether you were offered or turned down any jobs in that time.

Make sure to be responsive to every piece of communication coming from the state. For example, if your unemployment office schedules an interview and you fail to make that appointment, you will lose your eligibility and the payments will stop.

If you are denied unemployment, each state has an appeals process. Often you are denied based on a paperwork error or a technicality, so be diligent and follow through.

As the nation looks to get back on its feet, unemployment benefits are a bridge to get us there. If you have found yourself jobless because of the Coronavirus and the massive stay at home orders, don’t hesitate to pursue unemployment benefits. It’s what they are here for.


This article was written by Michael Giusti of InsuranceQuotes.com.

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