Unemployment Benefits A Comprehensive Guide to How Unemployment Works

Losing a job can shock and create concerns about short and long-term finances. Unfortunately, this has been a trend since the onset of the COVID-19 pandemic. The US unemployment rate went up from 3.8% in February 2020 to 13.0% in May 2020. By April 2020, the rate went up to 14.4%.

With many businesses closing during the pandemic, workers and their families lost wages, and the whole country suffered from losing goods and services they could have produced to generate income. These workers’ purchasing power was lost, resulting in more unemployment for other workers.

If you still find yourself out of work, there are benefits for the unemployed once you pass the qualifications. This infographic guide will explain these benefits and how to claim them. 

unemployment benefits infographic

What Are Unemployment Benefits?

Unemployment benefits serve as a temporary safety net for people who lost their jobs through no fault of their own. These benefits require you to look for work, be able to work, and be available to work should a position open up. Aside from that, you also need to meet your state’s recent earnings or work history requirements to qualify for the unemployment system.

An unemployed person is at least 16 years old, jobless, able, available to work, and actively looking for a job. It’s also anyone without a job proactively contacting employers about jobs and applying for them.

Stay-at-home parents, college students, and discouraged workers (people who stopped looking for work because they believed nothing was available) aren’t part of the unemployed demographic.

Requirements to Qualify for Unemployment Benefits

  • Must be unemployed through no fault of your own

There are many explanations as to how unemployment works. 

You might have lost your job because of an external factor, such as a layoff or a furlough. Quitting your job or being fired for misconduct doesn’t qualify you for unemployment benefits. However, if wrongful termination or constructive discharge played a role in your termination from employment, then it might be an exception to this rule.

  • Must meet your state’s requirements for wages earned or time worked during a specific period

This period is referred to as the “base period,” which is usually the “first four out of the last five completed calendar quarters before the time that your claim is filed.” If you lost a long-term job without cause or because of things beyond your control, you would meet your state’s requirements.

Types of Unemployment

  1. Frictional unemployment

    Frictional unemployment happens when people voluntarily leave their jobs. These are either people who have resigned or fresh graduates seeking their first jobs.

    This type of unemployment is usually short-term and not necessarily bad. Looking for a job, a replacement employee and the right employee takes some time.  

  2. Cyclical unemployment

    The variation in the number of unemployed workers during economic strength and weakness cycles is called cyclical unemployment. A nation’s gross domestic product (GDP) determines these cycles.

    Once the demand for products and services decreases, the production also decreases. It’ll result in fewer employers hiring people for jobs and increase unemployment.

  3.  Structural unemployment

    Evolving technology, government policies, and competition shifts cause structural unemployment. So while jobs are available, people who fill these roles don’t have the right skills or aren’t in the right location.

    For example, a company needs to move their work to a location that is too far away for their employees to go to, leading them to leave their jobs.

  4. Institutional unemployment

    When people become unemployed because of government and societal factors and incentives, this is called institutional unemployment. It includes high minimum wage floors, generous special benefits programs, strict occupational licensing laws, and discriminatory hiring.

How to File a Claim for Unemployment Benefits

  1. File unemployment online or over the phone

    Nowadays, most workers can search and apply how to claim unemployment benefits online or via phone by getting a hold of the workforce development office. You can check the US Department of Labor’s (DOL) comprehensive list of state unemployment offices to contact their phone numbers and website URLs.

  2. Review the information and documents needed to open a claim

    Generally, filing a claim means the state unemployment office asking you for certain information about your former employers and why you left your job. Ensure you give complete and correct information to avoid delays in your claim.

    Some information you might need to provide includes the following:
  • Your Social Security number
  • Driver’s license or state ID card number
  • Complete mailing address with zip code
  • Your phone number 
  • Employer Registration Number or Federal Employer Identification Number (FEIN) of your most recent employer

  1. Visit the state unemployment office

    Applicants must go to the unemployment agency in the state of their previous job. Out-of-state workers can apply in their residential state.

    Some federal workers have their own unemployment requirements, and applications need to be submitted to the federal government to issue a DOL unemployment claim.

  2. Collect unemployment benefits

    Your unemployment compensation is typically paid through a debit card or deposited to the claimant’s checking account at a certain percentage of your previous earnings. Normally, you can open and file for a claim and weekly benefits online.

Reasons for Disqualification from Unemployment Benefits

  1. Fired due to misconduct

    If you lost your job due to layoffs or a reduction in force, you would likely qualify for unemployment. However, you’re unlikely to qualify if you were fired for misconduct. Not all actions that lead to termination are considered misconduct. If an employee willfully engages in doing something that heavily injures the company’s interests, that can qualify as misconduct.

    Other types of misconduct are revealing trade secrets, sexually harassing coworkers, chronic tardiness, intoxication on the job, and dishonesty. Note that misconduct qualifications are a matter of interpretation and degree.

    Lack of skills, inefficient work habits, unpleasant personalities, and poor relations with coworkers won’t be reasons for disqualification.

  2. Frequent unexcused absences

    Remember that “laid off” and “fired for misconduct” differ. For instance, someone terminated for performance-related issues despite doing their best will probably qualify for unemployment benefits. But someone fired due to excessive absences might not be eligible.

  3. Harassment

    Employees who are fired for allegedly harassing other employees will be disqualified, especially if the employer proves the harassment occurred.

    Even the employees who should have done something about the harassment could be involved and disqualified once they apply for the benefits.

  4. Insufficient earnings or length of employment

    Your eligibility depends on a base period you need to reach to qualify for unemployment benefits. Generally, this base period is within one year: the four quarters preceding the five complete quarters of the calendar year. This base period doesn’t count your most recent job.

    Depending on the time you file, almost six months of work might not be covered in the base period. That is why many states have created an exception for workers who don’t work enough hours or have earnings in the base period to become eligible.

    Some states make exceptions for those out of work because of a job-related illness, disability, or injury.

  5. Quitting without good cause

    It’s impossible to qualify for unemployment after quitting unless you have compelling reasons to leave your job. For instance, resigning from your job to pursue a passion project isn’t a good cause. Quitting your job to continue your education or start a charity cause won’t qualify you for unemployment.

    Resignation for a good cause only occurs on a constructive discharge. It’s when you have no choice but to quit your job because your employer failed to make working conditions bearable (like not preventing sexual harassment from occurring or refusing to make improvements to working conditions.)

    Personal circumstances can also be considered good causes. Leaving your job to care for a sick or injured family member can pass as a qualification for unemployment.

Know Your Qualifications

Familiarizing yourself with how unemployment works and the unemployment benefits requirements will give you an idea of what you need to do to file a claim. 

If you still have questions about your application or benefits, contact your state unemployment office or check the FAQs section on their website. You can also call their hotline.

Consult an employment lawyer with a deep understanding of unemployment benefits if you have complex concerns. 

We at Shegerian & Associates can assist you with any issues with your unemployment claim. Contact us today, and let us help you.

Manuela Varela

Relations Manager

Manuela Varela has been with Shegerian & Associates since August 2022. She is responsible for outreach and marketing on behalf of the firm and manages relationships between firms and referring attorneys. She is also responsible for developing business opportunities and affiliations. Manuela graduated from Loyola Marymount University with a degree in Economics and Political Science.