Denying Unemployment Benefits – When Are Employees Not Eligible to Collect UI Benefits?

Denying Unemployment Benefits

Employers don’t always understand the basics about unemployment insurance (UI) benefits. It’s important to understand eligibility and when and for what reasons denying unemployment benefits is prohibited.

The history of UI benefits began in 1932. They were created to help provide support to workers who were unemployed because of the financial collapse in 1929. By 1937, all of the states had created their own UI benefit programs.

There are many situations which occur in the workplace that may lead an employee to be eligible to collect UI benefits. Poor performance, insubordination, repeated absences are just some of the few reasons for termination of employment. Depending on each situation and each state’s interpretation of the UI laws, these employees may or may not qualify for benefits.

Even workers who have worked to earn the minimum amount required and are available to work, can still be disqualified from receiving benefits, because of how they lost their jobs.

Here are the six most common reasons why an employee would not be eligible for UI benefits:

1.       They turned down a “suitable” job offer during the unemployment period. “Suitable” work is defined as a job that’s in line with the employee’s prior training, experience, and salary level.
2.       They were fired for misconduct – which includes a violation of a specific rule in the workplace or an “unwritten rule” that the employee is expected to know.
3.       They voluntarily left the job without good cause. Each state interprets whether good cause includes quitting for health-related or other personal reasons differently.
4.       They became unemployed because of a strike or the halting of work caused by a labor dispute.
5.       They are receiving Social Security, workers’ compensation, a pension, or severance pay.
6.       They either lied on their UI benefit claim or left out important information to get or increase their benefits.

Every employer should know the ins and outs of eligibility of UI benefits, but it’s most likely going to be different in every situation for denying unemployment benefits. It’s easier to rely on a third-party agency to handle the UI process on your behalf – makes dealing with eligibility so much easier.