Unemployment after severance runs out?

[Tom52]

If offered a severance package "voluntary resignation" meaning accept it or be terminated, is it possible to collect unemployment insurance when the severance payments run out?

 

[Ready]

It depends on the reason your employer determines you left. It's best to have a discussion before accepting a package where you ask what they will do if you file employment stating you were laid off. As long as they agree not to challenge it you will be fine.

And regarding the severance, it's best to get it all at once rather than over a period of time. If you get six months severance on departure, you can claim unemployment the very next day. If they pay you out over six months, you can't claim it until the payout finishes.

 

[Walt34]

I don't know for sure but perhaps this is one of the things that can vary by location? I'd call the local unemployment office and ask. The worst they're going to do is say "no".

 

[Accidental Retiree]

I don't know for sure but perhaps this is one of the things that can vary by location? I'd call the local unemployment office and ask. The worst they're going to do is say "no".

Exactly.

 

[SoReady]

If you get six months severance on departure, you can claim unemployment the very next day. If they pay you out over six months, you can't claim it until the payout finishes.

This isn't the way it worked for me. I received bi-weekly paychecks for 8 months severance. At the same time I filed for unemployment and received it concurrently. This is in the state of Illinois.

As others have stated you should talk with your employer and the unemployment agency for exact information.

 

[2B]

I got a lump sum once but it had a clause in the agreement that I would not be eligible for unemployment. My severance was many times more than the max unemployment at the time.

 

[ziggy29]

If offered a severance package "voluntary resignation" meaning accept it or be terminated, is it possible to collect unemployment insurance when the severance payments run out?

It depends on the nature of your state and the payout. I was given a lump sum six months severance pay when I was sacked last April, and I filed the UI with the Texas Workforce Commission immediately. I received a letter less than a week later confirming my immediate eligibility and that ex-Megacorp was not objecting to it.

 

[Bestwifeever]

Wouldn't the op's situation be an "involuntary resignation" or a "voluntary termination"? I would think a "voluntary resignation" would not be grounds for unemployment employment--I.e., if you quit, no benefits, vs if you get laid off or terminated.

 

[Walt34]

Wouldn't the op's situation be an "involuntary resignation" or a "voluntary termination"? I would think a "voluntary resignation" would not be grounds for unemployment employment--I.e., if you quit, no benefits, vs if you get laid off or terminated.

Again, I think it depends on the state. For example here one is eligible if one quits because of a "substantial change" in work conditions, such as a big reduction in pay, or transferring someone from a location that has a 10-minute commute to location that means an hour commute, or changing from day work after ten years to midnight shifts, then those are "substantial changes" in conditions.

So the OP will be best served by asking the local office.

 

[ziggy29]

Wouldn't the op's situation be an "involuntary resignation" or a "voluntary termination"? I would think a "voluntary resignation" would not be grounds for unemployment employment--I.e., if you quit, no benefits, vs if you get laid off or terminated.

In many cases, yes. In an "involuntary resignation," it's more or less "accept the severance or be terminated."

Whole I believe most states refuse benefits for someone who resigns rather than being terminated, there can be exceptions based on the circumstances. Obviously state laws vary, but here's something in Texas law about eligibility for UI after resigning rather than being terminated (just provided as an example, not advice or my opinion, my emphasis added) showing that under specific, defined circumstances you *can* receive UI even if you "quit", at least in some states:

http://twc.texas.gov/ui/bnfts/eligibility-benefit-amounts.html

If you chose to end your employment, then you quit. Most people who quit their jobs do not receive unemployment benefits. For example, if you quit your job for personal reasons, such as lack of transportation or stay home with your children, we cannot pay you benefits.

You may be eligible for benefits if you ... [q]uit for good cause connected with the work, which means a work-related reason that would make an individual who wants to remain employed leave employment. You should be able to present evidence that you tried to correct work-related problems before you quit.

Examples of quitting for good work-related reason are well-documented instances of:
* Unsafe working conditions
* Significant changes in hiring agreement
* Not getting paid or difficulty getting your agreed-upon pay

 

[Buckeye]

This isn't the way it worked for me. I received bi-weekly paychecks for 8 months severance. At the same time I filed for unemployment and received it concurrently. This is in the state of Illinois.

As others have stated you should talk with your employer and the unemployment agency for exact information.

File immediately for unemployment, give them all the facts, and let them decide. Once when I was laid off I was told I had to wait but, of course, I didn't pay any attention to what my ex-employer said. As it turned out, my unemployment DID NOT have to wait until all my severance was paid.

 

[ERhoosier]

Unemployment rules vary a lot by state. This site might be helpful-

Unemployment in the United States | AboutUnemployment.org

 

[lemming]

Be prepared to be out there actively looking for work

 

[Tom52]

Wouldn't the op's situation be an "involuntary resignation" or a "voluntary termination"? I would think a "voluntary resignation" would not be grounds for unemployment employment--I.e., if you quit, no benefits, vs if you get laid off or terminated.

It is called a "voluntary resignation" but it was not instigated by me and when I asked what would happen if I refused to sign it. I was told I would be fired. Perhaps it is written in such a way as to make it appear they are doing me a favor when in fact they want me out. I would have no way to prove what was said.

 

[Ronstar]

I would think that op's employer's idea of "voluntary resignation" is just that - voluntary. I wouldn't think that voluntarily resigning would qualify for unemployment compensation. We had a situation where a lady on pregnancy leave asked for an additIonal year of time off. We asked that she resign and that we would hire her back after one year if we had work for her at that time. She voluntarily resigned, we did not rehire her, and she filed for unemployment compensation. It was denied - probably because of the terms in the voluntary resignation letter.

 

[spncity]

May be considered a "forced resignation." And just because you get denied when you first apply does not mean you would keep getting denied.

Some states allow collection of unemployment benefits concurrently with severance pay. Some do not.

It may be worth paying for an hour of time from an attorney that specializes in employment law. Some will tell you that the employer cannot legally keep you from applying for unemployment.

Kindest regards.

 

[Texas Proud]

When I got let go from mega back in 2007, I had a good number of months of severance from them.... but, I also qualified for unemployment as I was not working for the payments....

The question they ask is if it is payment for work such as vacation, sick etc, or payments not for work.... it is the not for work payments that do not hurt you (at least here in Texas)....

 

[Rustward]

Tom, just contact your unemployment office. They will contact the employer and determine what you are eligible for.

Edit to add: I very seriously doubt that you will be eligible for an unemployment benefit if you resign. If it worked this way, large numbers of people would resign their jobs as soon as they became eligible for benefits, and would rejoin the workforce after the benefits ran out. Repeat until too old to work . . .

Having employees file for unemployment benefits probably affects the employer's unemployment insurance premiums in a negative way. Anybody know how this works?

 

[bizlady]

As others have said, it varies by state. However, when you resign, you generally do not have a severance package, and severance packages are generally in writing.

Review the contract, see what it says. Then call the unemployment office and see what they say. At least then you can make an informed decision.

 

[Sarpy]

I've known people in my old megacorp who were successful in getting UI, even when taking an early retirement package. Those that were successful provided public and/or internal documentation that the company was going to layoff X% of the workforce and/or that the company was targeting a specific business unit or functional role. Some described feeling pressure to accept the package. Often they had to re-apply or escalate, and may have had to appear in front of a judge.

But, as mentioned earlier, it seems to vary by state.

 

[Texas Proud]

Also be aware that if you are let go for cause, then you also do not get UI...

Just a comment, not directed at anybody....

 

[John Galt III]

And no more "99 weeks" of collecting, since the federal version of extended unemployment benefits has been done away with, at least for now. People getting laid off now will only get state level unemployment bens, usually just 26 weeks, unless things change.

 

[target2019]

I had a significant case of the furlough blues last year, and feel another bout may be coming on. So I had use of my state's funds, and can reiterate that you must contact your state for guidance.

I noticed that those who went into the office received different advice than some who called. And my experience was trouble-free as I only interacted with the state-run website.

Just this week I found a substantial written document online, and it explained in writing various rules that were getting mangled when reinterpreted by officials and the unemployed.

Do as much research as possible, and find written documents that can substantiate what you are told.