Unemployment Insurance: 7 Surefire Ways to Get It
Life + Money

Unemployment Insurance: 7 Surefire Ways to Get It

REUTERS/Shannon Stapleton

Last month, the country’s unemployment rate ticked up slightly from 6.6 to 6.7 percent, but over the past year the rate has continued a gradual march downward, as 1.6 million fewer workers were unable to find a job.

Even as the economy slowly recovers from the Great Recession, there are still regions and industries where job security is no guarantee. In the past few weeks alone, companies as diverse as Best Buy, JP Morgan, and IBM have announced plans to cut thousands of jobs.

If you’ve recently received a pink slip, here’s everything you need to know about collecting your unemployment benefits:

1.       Most people qualify. If you lost your job through no fault of your own (i.e. you didn’t quit or get caught stealing from the till), you probably qualify for payments. “As long as you were meeting the legitimate expectations of the employer, then you qualify for benefits,” says Tom Spiggle, an employment lawyer in Arlington, Va. 

2.       You can file in your pajamas. Most states now have online enrollment programs, which make it extremely easy for applicants. Just log on, enter some basic biographical information about yourself and your former employer, and you should be set. Your employer will be notified of your request and could contest your application if you were fired for sub-standard performance.

Related: Where Unemployment Insurance Benefits Stand in Your State

In that case, the state employment commission will hold a hearing—usually by phone—to review both your and your former company’s case. You don’t need a lawyer for this hearing, although if your case is complicated, or your potential payments are large enough, you may want to hire one.

3.       Don’t take no for an answer. Even if your claim is denied after the initial hearing, you can contest the findings. In most states, that requires writing a letter to an appeals board outlining your case and explaining any issues that you think the hearing officer may have missed. “When you get up to the next level, you’re dealing with a lawyer and someone who may be more in tune to the law than the first hearing officer,” Spiggle says. “Our clients have had a lot of luck getting decisions overturned on appeal.”

4.       The payments may be less than you expect. State laws typically aim to replace about half of a worker’s previous earnings to a maximum benefit level. The average payment is around $300 per week, while the average worker earned $782 per week in the fourth quarter of last year. Benefits vary from state to state; they top out at $235 in Mississippi and $675 per week in Massachusetts. 

Keep in mind, also, that you’ll have to give some of those benefits back to Uncle Sam at tax time. Both states and the federal government treat unemployment payments like wages, so they’ll be taxed at a graduated rate. It’s a good idea to withhold a percentage of your benefit to cover these taxes so you aren’t slapped with a huge bill at tax time. (You might be able to get some of that money back, however, by writing off job seeking expenses such as job fairs or resume writing services.)

5.       You can get health insurance, but it will cost you. In most cases, you can continue to use the insurance provided by your former employer via the COBRA program, but you’ll have to pay full freight, since your employer will no longer be subsidizing the plan. Get ready for sticker shock: Employers typically shell out nearly $12,000 per year for each of their workers’ family plans, according to the Kaiser Family Foundation.

Related: ‘Carolina Comeback’ Masks Long-Term Unemployment

Laid-off workers have another new option for insurance. Since getting laid off is a “qualified event” under Obamacare, you can shop for an individual plan on the public exchanges or via a private insurer or broker to see if you can find a better deal than COBRA.

6.       Be ready to prove you’re looking for a job. You’ll have to check in regularly with your state’s unemployment office to continue receiving benefits. You’ll have to show them that you haven’t been working, you’re actively seeking employment, have not turned down a “suitable job,” and have been readily available to work.  

Some states allow you to do this online, while others will require a phone conversation or an in-person visit. Agents may ask you to provide emails or other evidence that you’ve been looking for a job, and have been available to work. Lying on your weekly claim form is unemployment fraud.

7.       It doesn’t last as long as it used to. At the end of 2013, Congress allowed the expiration of a program extending state unemployment benefits for the long-term unemployed. At the height of the Great Recession, extended benefits covered workers for up to 99 weeks, although that was eventually reduced to 73 weeks. 

Since the expiration of federal emergency benefits, most states provide workers with 26 weeks of coverage. In Florida, workers filing new claims this year are only entitled to 16 weeks of unemployment payments, while Massachusetts residents can get up to 30 weeks.  

The Senate has reached a bipartisan deal that would reinstate the federal extension of benefits, but House Majority Leader John Boehner (R-OH) has dismissed that deal as “unworkable.”

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