Losing your job is already one of the most devastating things that can happen to you. And, unfortunately, many people who become unemployed face significant financial difficulties. For example, you may have trouble paying your rent/mortgage, making car payments, repaying student loans, and buying groceries and other necessities. Luckily, most American workers who lose their job – through no fault of their own – are eligible to receive unemployment compensation to help them get by for a while.
What is Unemployment Insurance?
In the United States, unemployment insurance is a joint federal-state program that offers cash payments to unemployed workers. Typically, the federal government covers the costs of paying benefits to unemployed workers. State governments cover the administrative costs of running their respective unemployment insurance program. Therefore, if you lose your job, you will apply for benefits through your state’s unemployment office. If your claim is approved, your payments would be funded by the federal government. The federal government funds unemployment benefits from a payroll tax that employers pay on behalf of their employees.
To qualify for unemployment compensation, you must have been an employee for at least four out of the last five quarterly periods. Furthermore, you must have lost your job through no fault of your own. That usually means a layoff resulting from less business activity. Unfortunately, millions of Americans are not eligible for unemployment compensation should they lose their primary income source. For example, if you own a business that goes bankrupt or a freelancer who loses your gigs – you can’t file an unemployment claim for compensation. Many states impose additional requirements like meeting a certain income threshold. You can research your state’s requirements for unemployment benefits online.
Applying for Unemployment Benefits
Every state has its application process for applying for unemployment compensation. You can still apply in person at your local unemployment office in most states. However, many states encourage applicants to apply online because it saves time and paperwork. You will have to search online to find out how to apply for unemployment in your state. However, you should apply for unemployment compensation as soon as you can because it can take at least a few weeks for you to start receiving benefits. First, your state will have to review your application. Then, you will be scheduled for a hearing to attend. Your evidence will be presented at the hearing to help determine whether your unemployment claim should be approved or denied. For example, your former employer could attend to lobby against you if they claim you were fired with cause. If your application is approved, you will likely start receiving cash payments in a couple of weeks.
In short, unemployment insurance is intended to help eligible workers who lose their jobs. Unfortunately, since the program only covers W-2 employees, millions of Americans are left out. You will have to check with your state’s unemployment insurance program to determine whether you can apply. If you qualify, you should begin the application process immediately after losing your job so you can start receiving compensation sooner.