What is Unemployment Insurance and how to apply for it?

When you become unemployed in an unjustified or illegal way, you can resort to unemployment insurance or Unemployment Insurance. Here we explain what it is, its benefits and how to apply for it.

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What is Unemployment Insurance?

Created in 1935, the federal unemployment system is intended to replace a portion of the salary for those who no longer have a job.

This temporary assistance is a kind of social insurance financed by active taxpayers through the payment of taxes. This program also serves to stimulate consumption when the economy is in trouble.

Unemployment Insurance

Although the Unemployment Insurance program is overseen by the U.S. Department of Labor, each state sets its own rules and benefits.

On average, the assistance provides almost half of the lost wages and the duration is usually 26 weeks. While the government takes care of the administrative costs, the governments finance the unemployed.

Within the system, there is what is called the Extended Benefits program, which adds 13 to 20 more weeks of coverage when the unemployment situation in the states worsens. The duration of this extension depends on state laws and the federal government has been in charge of subsidizing it since 2013 (2009 Recovery Act).

Historically, the U.S. government has implemented these temporary subsidies in times of recession. The most recent was the EUC (Emergency Unemployment Compensation), which ran from June 2008 to December 2013.

Although these initiatives are funded by the states, the last recession left some systemic problems that have not been resolved.

Requirements for Unemployment Insurance

The requirements to qualify for unemployment insurance or unemployment benefit/allowance are as follows:

  • Have lost your job through no fault of your own.
  • You must be able to work, be available for work, and be actively seeking work.
  • You have earned a certain amount of money for a 'minimum period' before you were terminated from your job.

These criteria are interpreted differently by each state administration. For example, while some states do not cover part-time employees unless they are willing to accept a full-time job, other states do. As for the minimum period, each governorate chooses the eligibility.

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Except in times of recession, since 1950 less than half of the unemployed have received this assistance. This is because this assistance does not cover voluntary job leavers, first-time job seekers and re-entrants who previously left their jobs of their own free will.

Unemployment Insurance Benefits

Unemployment Insurance benefits come from the state where you work, even if you reside elsewhere. When you apply, which is usually done online or by phone, the state in question determines who qualifies and how much they will receive. That said, the benefits correspond to:

Number of weeks

While some states give the same number of weeks of unemployment benefits, others vary this duration based on past earnings.

The latter depends on whether you received income in each of the quarters of the year that make up the 'base period' and how evenly it was distributed to you in that time frame.

In most states, contributors are eligible for a maximum of 26 weeks, although many are given less due to limited history or uneven earnings. Under normal economic circumstances, most claimants find work before exhausting the duration of benefits.

Amounts awarded

The average cash award for beneficiaries is usually more than $300 a week. However, individual levels vary widely depending on past earnings. In some states, workers receive more if they have dependents.

State laws seek to replace at least half of lost wages. In 2014, the maximum subsidy was $133 in Puerto Rico, $235 in Michigan and up to $679 in Massachusetts ($1,079 with dependents).

Since this benefit is capped, unemployment insurance replaces a smaller fraction of earnings for those who earned higher wages.

Unlawful termination and filing for UI

To conclude, it is important to understand that you may be subject to unjustified dismissal. In this regard, you should know the following:

  • Unlawful termination or wrongful termination laws vary from state to state, so you should contact your local employment office if you believe this has happened to you.
  • Some states have a 'work at will' policy, which means that if there is no particular/collective bargaining agreement, an employer can fire you with or without reason. When your employer breaks the law, you should seek legal help.

How to apply for unemployment insurance?

If you have lost your job for illegal or unjustified reasons, you can apply for Unemployment Insurance. Since each state handles this benefit differently, you should approach the employment office to determine your eligibility and how to proceed.

Depending on what they tell you, you may be able to apply online, in person or by phone.

English: ¿Qué es el Seguro de Desempleo y cómo solicitarlo?