Is a Fired Employee Eligible for Unemployment Benefits?

So You Got Fired - Can the Government Help?

Unemployment insurance was created in the late 1930s to provide a safety net for those who through no fault of their own are laid off. But what about employees whose work performance and office behavior becomes unethical, or worse, criminal? Here’s how to determine which employees are eligible for unemployment benefits and who aren’t.

Firings and Unemployment
Firings and Unemployment

How Unemployment Insurance Works

Unemployment insurance refers to the overall system whereby employers pay the Internal Revenue Service (IRS) state and federal unemployment tax to fund unemployment benefits and workforce programs. The unemployment insurance program was created in 1939 as a result of the Federal Unemployment Tax Act (FUTA).

The primary purpose behind unemployment insurance is to provide a safety net for people who are suddenly cut off from their source of income due to downsizing or poor financial conditions. The secondary purpose of unemployment insurance is to provide a stimulus to the economy in times of recession so that workers are able to continue to spend money using their unemployment benefits.

Laid Off or Fired?

Laid off means the person is let go from the company through no fault of their own (e.g., downsizing, financial hardship). Fired means the person is separated from the company for disciplinary reasons or poor job performance.

Employees in the U.S. cannot receive unemployment benefits if they are fired from their job for poor work performance, embezzlement, theft, sexual harassment, or other workplace violations. However, those caught up in layoffs through no fault of their own are precisely who the U.S. unemployment insurance system was created for.

Who is Eligible for Unemployment Benefits?

According to the U.S. Department of Labor, in order to be eligible for unemployment benefits the employee must meet his or her state’s requirements for wages earned or time worked during the base period (typically the first four out of the last five completed calendar quarters prior to the time that the claim is filed). The worker must be unemployed through no fault of his or her own as determined by state law, and he or she must also meet other eligibility requirements as set forth by the state.

How Long Do Unemployment Benefits Last?

The duration of unemployment benefits for laid off workers in the United States is 26 weeks. However, during an economic recession, they may be extended by an Act of Congress.

To continue eligibility, the employee must file weekly or biweekly claims and be available to respond to questions regarding continued eligibility. Also, he or she must report any earnings from part-time or contractual independent employment and reasons for refusing a job offer (e.g., too far away from home, job doesn’t match career).

How to File for Unemployment Benefits

You can quickly and easily file for unemployment benefits over the internet or by phone. The CareerOneStop website is sponsored by the U. S. Department of Labor, Employment and Training Administration. Just click on your state to find out how to file.

Bottom Line on Firings and Unemployment Benefits

Bottom line, in most cases the employee cannot receive unemployment benefits after having been fired. In certain circumstances (e.g., the company was already beginning to lay people off), you can ask your manager or human resources department if the term firing can be changed to layoff. But in most cases, the employee is fired because of disciplinary reasons (e.g., poor job performance, theft, embezzlement, sexual harassment) which automatically makes him or her ineligible.

In rare circumstances, a fired employee can still file for unemployment benefits. If the benefits are denied, he or she can take it one step further and file an appeal. However, this is a long process that could take weeks or even months for the state government to make a final determination.

Receiving Unemploymet Benefits After Being Fired

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