What is unemployment insurance (UI) ?

Unemployment insurance (UI), also called unemployment benefits, is a type of state-provided insurance that pays money to individuals on a weekly basis when they lose their job and meet certain eligibility requirements. Those who either quit their jobs or were fired for a just cause are not eligible for UI. In other words, someone separated from their job due to a lack of available work and at no fault of their own usually qualifies for unemployment benefits (UI).



Each state administers its own unemployment insurance program, despite it being federal law. Workers must meet their state's work and wage requirements, including time worked. The benefits are primarily paid out by state governments and funded by specific payroll taxes collected for that purpose.

Meaning of Unemployment Insurance:  The unemployment initiative is a joint program between individual state governments and the federal government. Unemployment insurance provides cash stipends to unemployed workers who actively seek employment. Compensation to eligible, unemployed workers is through the Federal Unemployment Tax Act (FUTA) along with state employment agencies.

Each state has an unemployment insurance program, but all states must follow specific guidel
ines outlined by federal law. Federal law makes unemployment benefits relatively ubiquitous across state lines. The U.S. Department of Labor oversees the program and ensures compliance within each state.

Out of work persons who do not find employment after a 26-week period may be eligible for an extended benefits program. Extended benefits give unemployed workers an additional number of weeks of unemployment benefits. The availability of extended benefits will depend on a state's overall unemployment situation. If you have become unemployed due to the coronavirus pandemic, see below for details of the various programs.

Requirements for Unemployment Insurance (UI):  An unemployed person must meet two primary requirements to qualify for unemployment insurance benefits. An unemployed individual must meet state-mandated thresholds for either earned wages or time worked in a stated base period. The state must also determine that the eligible person is unemployed through no fault of their own. A person may file an unemployment insurance claim when fulfilling these two requirements. 

Individuals file claims in the state where they work. A participant may file claims by phone or on the state unemployment insurance agency's website. After the first application, it generally takes two to three weeks for the processing and approval of a claim.

After approval of a claim, the participant must either file weekly or biweekly reports that test or confirm their employment situation. Reports must be submitted to remain eligible for benefit payments. An unemployed worker cannot refuse work during a week, and on each weekly or bi-weekly claim, they must report any income that they earned from freelance or consulting gigs.

Pandemic Unemployment Assistance (PUA): The Pandemic Unemployment Assistance (PUA) expands UI eligibility to self-employed workers, freelancers, independent contractors, and part-time workers impacted by the coronavirus pandemic. Self-employed workers generally may not qualify for UI, and the PUA helps to provide them financial assistance.


( Source from : https://ascendbusinessadvisory.com/ascend/wp-content/uploads/2020/06/Screen-Shot-2020-06-18-at-2.43.04-PM.png)

The program was set to expire on Dec. 31, 2020, under the CARES Act but was extended until March 14, 2021, because of the Consolidated Appropriations Act.1 This gave unemployed American workers a total of 50 weeks of benefits.

The PUA was given new life, adding an additional 29 weeks to the program after the Biden administration passed the $1.9 stimulus package in March 2021. According to the American Rescue Plan Act, the PUA will expire on Sept. 6, 2021, after a total of 79 weeks.

There are some others benefit given by the federal or state government to the unemployment person & some assistance also given to businessmen, self-employed.

(Article sources from: https://www.investopedia.com/terms/u/unemployment-insurance.asp)


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