HR Support on Unemployment Insurance

Editor's Note: Understand state unemployment insurance eligibility requirements.

Tracy MorleyOverview: Unemployment insurance provides temporary financial assistance to workers who have lost their jobs through no fault of their own. Unemployment insurance is administered at the state level (in compliance with federal law), and each state establishes its own rules with respect to amounts, duration and eligibility for benefits.

The Federal Unemployment Tax Act (FUTA) requires employers to pay a federal tax of six percent of the first $7,000 paid to each employee. Most states also require employers to make additional contributions. Only a handful of states require employees to make contributions to unemployment insurance.

Eligibility for benefits varies by state, but in most states unemployed workers must:

  • Not have left employment voluntarily;
  • Not have been terminated for misconduct;
  • Be available for, and actively seeking, work;
  • Not refuse suitable work; and
  • Not be unemployed due to a labor dispute.

Benefits are generally a percentage of earnings over the most recent 52 weeks up to a state maximum and are usually paid for up to 26 weeks. Additional benefits may be provided during periods of high unemployment.

Trends: While employees who quit their jobs generally are not entitled to receive unemployment benefits, some states make an exception for employees who quit due to domestic violence, including Arizona, Arkansas, California, Maryland, New Jersey, Texas, Washington and, beginning October 5, 2014, Minnesota.

Author: Tracy Morley, SPHR, Legal Editor

Latest items in Unemployment Insurance