Overview: 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:
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
Ford Harrison employment attorney Amy Turci discusses a host of furlough-related coronavirus issues with XpertHR Legal Editor David Weisenfeld.
Updated to include CARES Act information regarding unemployment insurance.
XpertHR offers many tools and resources to help New York employers ensure that their response to the novel coronavirus (COVID-19) outbreak complies with applicable state and local laws.
XpertHR offers many tools and resources to help employers evaluate employee benefits considerations that may arise as a result of the coronavirus (COVID-19) pandemic.
Updated to include information on the Cal-WARN Act.
Amidst the growing global coronavirus pandemic, the House of Representatives has passed a sweeping bill that aims to strengthen the safety net for workers.
As recommended by the California Employment Development Department, employers can refer to guidance in various topic areas, including withholding taxes and unemployment insurance, in the California Employer's Guide, DE 44.
Updated to include expanded unemployment penalty provisions, effective January 20, 2020.
Updated to reflect developments regarding the ABC test for independent contractor status, effective January 16, 2020.
Updated to reflect increased state paid family leave contribution rates, effective January 1, 2020.
HR guidance on laws governing unemployment insurance.