Every week we comb through the news to find employment trends affecting the hospitality industry so you don’t have to. This week’s topic: working while on unemployment.
When the U.S. was forced to quarantine due to the coronavirus, thousands of employees were either let go or placed on furlough until further notice. Because of this, unemployment claims grew from “6.2 million in February to 20.5 million in May 2020” – an increase of over 230%.
Although states are in various phases of reopening, the regular emergence of new cases continue to force some to rely on unemployment benefits. But, is it possible to work at all while still collecting unemployment?
First, it’s important to know what exactly ‘unemployment’ is: “Unemployment Insurance (UI) provides unemployment benefits, usually in the form of weekly payments, to eligible workers who become unemployed through no fault of their own and meet certain other eligibility requirements. UI is administered jointly by the U.S. Department of Labor and individual states.”
In terms of working while still receiving unemployment, the short answer is yes, you can still work while receiving unemployment benefits – but it’s complicated. The first piece to understand is that unemployment benefits vary from state to state, so when trying to understand what you’re eligible to receive, check out the Unemployment Benefits Finder from CareerStop.
There are two options for working while still receiving UI benefits. One option is through a work-sharing program, which “helps businesses to avoid laying off workers by letting them reduce worker hours instead. These workers receive a prorated unemployment benefit from the state to compensate for lost wages.” Unfortunately, work-sharing programs are only available in 26 states (click here to see a list) and aren’t well known by employees/employers. If your state offers work-sharing programs, contact your employer to find out how to get involved.
The second option to receive unemployment while being employed is to work a part-time job. According to EmploymentLawFirms.com, there are several requirements in order to receive this benefit, which include:
- You are involuntarily underemployed. This could be because your job cut your hours, or because you lost your full-time job and can only find part-time or limited employment. It’s important to note that to be eligible for benefits in this situation, you cannot be voluntarily working part–time.
- You must meet your states minimum hours worked and minimum earnings requirements.
- You are available to work more.
If you meet the above requirements, the amount you receive will be determined by your state’s unemployment calculation, which considers how much you’re owed and how much you’re earning. EmploymentLawFirms.com gives the following example to demonstrate how unemployment benefits are calculated in Washington D.C.:
“Susan works in Washington, D.C. and would be eligible for a weekly unemployment benefit of $300, based on her prior earnings. She was laid off from her job, and she currently earns $250 per week from a part-time job. The District of Columbia disregards one-fifth of her earnings plus $20, in calculating partial unemployment benefits. Based on this formula, the state would take her earnings of $250 and subtract $70 (one-fifth of her earnings is $50, plus $20). The remaining number, $180, is then subtracted from $300 (the amount she would receive if fully employed), for a partial benefit of $120.”
- While you can work and collect unemployment benefits, there are various requirements you must meet to show that you are not voluntarily working part-time and desire full-time employment.
- Benefits are decided based on a detailed formula and differ state to state.
- UI will take into account your current pay to determine your weekly benefit.
In some cases, it’s certainly possible that you may make more money through unemployment benefits than by taking a part-time job. It’s up to you to decide what employment situation works best for you, but consider the impact you would see post-COVID by staying active in the workforce. It may make you a more desirable candidate because of a smaller gap in your resume, or make the transition back to full-time employment easier.
On average, Americans receive $378 per week in unemployment benefits. LGC’s flexible opportunities may allow you to work a couple temporary gigs each week while still qualifying for unemployment. Apply for an open position today.