For the average worker, losing a job can quickly turn into a financial crisis. How will you pay the mortgage or rent or buy groceries without a steady paycheck? How will you support yourself and your family while you look for a new job?
Fortunately, most employees can get some temporary financial help by filing a claim for unemployment compensation (also called unemployment insurance, unemployment benefits, or simply unemployment).
Every state makes unemployment benefits available to employees who lose their jobs through no fault of their own. However, you have to apply for benefits, meet the eligibility requirements, and search diligently for a new job in order to qualify.
What Is Unemployment Compensation?
Unemployment compensation is a joint federal-state insurance program that provides those who are temporarily out of work some wage replacement while they look for a new job. Each state runs its own unemployment compensation program.
Although these programs all have a similar structure, each state has its own rules about eligibility for benefits, filing a claim, how much money applicants receive, and how long benefits last (among other things). The federal Department of Labor oversees the whole process and helps pay each state's costs of running their programs.
Normally, only employees are eligible for unemployment benefits, and you can’t collect unemployment if you were working as an independent contractor. One exception is if you're actually an employee but have been misclassified as a contractor.
Unemployment Eligibility Requirements
To qualify for unemployment compensation, you must meet two basic requirements: a minimum earnings/work history, and loss of your job for no reason of your own.
What Earnings History Do You Need to Collect Unemployment Benefits?
Normally, in order to receive unemployment benefits, you must have earned a minimum amount of money and/or worked for a minimum amount of time during a set period of time before losing your job. This period of time, called the “base period,” is a 12-month period, usually the earliest four of the last five complete quarters of the calendar before you became unemployed. In other words, the base period usually ends at least a few months before you lose your job.
Can Independent Contractors File for Unemployment Benefits?
As mentioned earlier, in general, if you're an independent contractor, then you don't qualify for unemployment benefits. However, if the company you work for misclassifies you as an independent contractor when you should be designated as an employee, then you can receive unemployment benefits. You should check your state's rules for classifying workers.
Typically, employers pay federal and state unemployment taxes (commonly known as "unemployment insurance"). The federal and state governments use these taxes to provide unemployment assistance to qualifying individuals. Employers don't pay unemployment insurance on behalf of independent contractors. As a result, only employees—not independent contractors—can collect unemployment benefits.
Can You Get Unemployment If You Quit or Are Fired?
The second requirement has to do with why you are unemployed. You may collect benefits only if you are out of work without fault. You may not be eligible for unemployment if you quit your job voluntarily, without good cause, or if you were fired for misconduct.
What is Good Cause to Quit?
Each state has its own definition of good cause to quit. In some states, including California, good cause to quit includes reasons not related to work, such as family caretaking responsibilities. In other states, your reason for leaving work must be related to your job. You will likely be found to have quit for good cause if you leave your job because of:
- unsafe or unhealthy working conditions that persist after you’ve told your employer
- harassment or discrimination that your employer won’t remedy, or
- your refusal to participate in illegal conduct.
On the other hand, you will likely be found not to have quit for good cause (and therefore, ineligible for unemployment benefits) if you quit because you want to go back to school, you want to travel, or you are bored with your current job. The bottom line, you must have good cause to quit in order to collect unemployment.
Reasons for Being Fired That Make You Ineligible for Unemployment
What type of job misconduct is serious enough to make you ineligible for unemployment compensation? Again, it depends on your state’s law. Generally, you won't be eligible if you were fired for conduct that goes beyond simple poor judgment, personality conflicts, or performance problems stemming from your inability to do your job. Examples of serious misconduct include:
- frequent unexcused absences or lateness
- insubordinate behavior (such as cursing at your supervisor or refusing to do assigned work)
- stealing or dishonesty, or
- drinking or drug use in the workplace.
How to File for Unemployment Benefits
You should file an unemployment compensation claim with your state agency as soon as you've lost your job. It sometimes takes several weeks to start receiving payments, so the sooner you file, the better.
In virtually every state, you can file a claim online. Some states also allow you to file for benefits by phone or in person at your local unemployment office. You’ll find information and filing instructions at your state unemployment agency.
Shortly after you file, you will receive a notice of eligibility from the agency. This notice will let you know whether you meet the state’s monetary requirements and how much you can expect in benefits. If there is a dispute about whether you are eligible for benefits (for example, because you say you were laid off and your employer says you were fired for misconduct), the agency may hold a hearing to decide the issue.
What Unemployment Benefits Will You Receive?
Regular unemployment benefits are paid for 26 weeks in most states. Some states, including Florida, provide benefits for a shorter period of time. And extra benefits might be available during periods of state or national emergency, such as the COVID-19 pandemic, or during periods of high unemployment.
Benefits might also include training programs, access to job listings, and other assistance in finding a job.
Maintaining Your Benefits
You may lose your benefits if you don't follow your state agency’s rules on looking for work. For example, while receiving unemployment benefits, you must:
- be able and available to work
- actively look for a job each week, and
- report to your state agency any job offers you receive, any job offers you decline, and any wages you make each week.
Your state agency might require you to report all of the jobs you apply for, keep a record of your job search, or register for work through a state jobs portal.
When to Hire an Unemployment Lawyer
Most people are able to complete the initial application for unemployment benefits without the help of a lawyer. The application forms are typically easy to understand and available in multiple languages, and you can always call or visit your state’s unemployment agency if you have questions.
But if your claim is denied, you should seriously consider hiring an unemployment attorney to file your appeal and represent you at your administrative hearing. A lawyer can sort through all of the evidence, formulate legal arguments, and present the strongest case on your behalf.
In addition, a lawyer can be essential if you have both an unemployment claim and grounds to file a lawsuit against your employer. For example, if you were fired in violation of federal antidiscrimination laws, you’ll not only be entitled to unemployment but also have a wrongful termination claim.
Many unemployment lawyers will work on a contingency fee basis, which means they’ll charge a fee only if you win your case.