The Basics of Unemployment Benefits

For many jobless Americans, unemployment benefits would be a welcome addition to a tight budget. Typically only one out of three unemployed Americans is receiving unemployment benefits at any given time. However, those numbers tend to go up to around 50% during a recession. Unemployment benefits are governed by state law, with some states being more restrictive than others. But many unemployed don’t apply for benefits at all.

The end of unemployment lines?

There is nothing fun about unemployment. The same can be said for going to the unemployment office to seek benefits. But thanks to modern technology many states now accept applications for unemployment benefits online or over the phone. According to a 2005 study, over half of unemployed Americans didn’t apply for benefits because they thought they were ineligible. However, it can’t hurt to apply to find out for sure.

Who qualifies for benefits?

Not everyone qualifies for unemployment benefits. Individuals who quit their job, only worked part-time, were fired for misconduct, or hadn’t earned enough to qualify may be denied benefits. The laws for qualifying vary between states, however.

For example, in some states, you might qualify for benefits despite working part-time. While voluntarily working part-time likely won’t be enough to qualify, some states award benefits to former full-time workers who have had their hours cut. There are exceptions for workers that leave their jobs, too. An employee forced to leave their job to care for a sick family member will qualify for benefits in some states, for example.

Recession Rush

Not only are there more unemployed workers during a recession, but a higher percentage of those workers will qualify for unemployment benefits. Because of the mass layoffs that often come with a recession, a much higher number of workers will have been terminated. Workers that were temporarily furloughed can also qualify for benefits if that furlough becomes permanent. While an employee would still get credit for the entire time they remain unemployed there are some states that have strict time cutoffs related to filing for unemployment.

File for benefits yourself

No states charge the jobless to apply for unemployment benefits. And while there are private services that will prepare an application for a fee, those applications won’t get benefits any faster than if the process is done by the applicant themselves. Typically the process is fairly straightforward, so it doesn’t make sense to spend part of a limited budget for something that can be done for free.

States are also beginning to crack down on these application services. The Nebraska Department of Labor has previously issued a warning that it had come to their attention that “there are websites offering fee-based services for filing for unemployment benefits,” and that while those services may be legal that information can be obtained for free without an individual having to risk their personal information.

The process after the application is filed is fairly similar between the states. Once a jobless worker applies for benefits the application is forwarded to the former employer. The employer then has the opportunity to contest the worker receiving benefits. The state will hear arguments from both sides before determining whether benefits will be awarded or not. If the state denies an award, the jobless worker can appeal the decision. While it is permissible to have an attorney the appeal deadline is often tight, which leaves little time to find legal counsel.

How do you make ends meet?

Unemployment benefits are often the only source of income for the jobless that lack savings or other resources to fall back on. Nevertheless, states place a maximum limit on the total benefits a person can receive. The amount of benefits awarded is usually based on a percentage of the average wages within the state per week. Normally this percentage is 50 or 70 percent. Take Illinois as an example. In Illinois, the top weekly benefit is $385 for a single individual, $459 per week for a jobless worker with a dependent spouse, and $534 per week for a jobless worker with dependent children.

This often adds up to a dramatic change in a families’ budget and lifestyle. There are other options for families to help make ends meet, including nonprofit organizations like the United Way. There are also other forms of public assistance like WIC or food stamps that can help a family or individual bridge the gap between jobs.

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