Unemployment insurance is a program offering financial assistance to workers who lose their jobs. These cash stipends are intended to help them pay daily living expenses while they find new employment.
Unemployment is a joint state/federal program, and each state has its own unemployment insurance offices and claims procedures, all of which must comply with federal law. In most states, an unemployed worker can apply for benefits even though she owes money to the unemployment office.
Unemployment Insurance Laws
Both state and federal governments have enacted laws that implement unemployment insurance benefits. Federal unemployment insurance laws are the province of the U.S. Department of Labor, while each state taxes its employers and runs the state system.
In essence, unemployment insurance programs make periodic payments to employees who lost their jobs without having done anything wrong. That means that workers fired for misconduct cannot get these benefits. States set thresholds for wages a worker must have earned or the amount of time he must have worked to be eligible. Once she has met these requirements, she can file an unemployment insurance claim.
Read More: How to Quit Your Job & Still Qualify For Unemployment Insurance Benefits
Procedure for Filing a Claim
A worker who loses his job or gets his employment hours cut should file a claim as quickly as is feasible. He can do this online, in person or over the phone, providing critical information such as where he worked, the name and address of his supervisor, his last date of work and his work history. The exact procedure will vary from state to state.
Once all of the information has been provided, an employee is, in some states, required to wait until a one-week period passes. In other states, there is no waiting period. On average, the time it takes for a claim to be reviewed, approved and start paying benefits is between two and three weeks.
Insurance Benefits Overpayment and Fraud
If an employee receives more money in unemployment benefits than he is owed, it is called an overpayment. An overpayment can result from fraud – for example, a deliberate overstatement of wages in an attempt to get undeserved benefits. It can also result from an accidental error or overpayment, completely unintentional on the part of the worker or the office. Often, an overpayment occurs when an employee is awarded benefits, but the employer appeals and wins that appeal.
A state unemployment agency will require that an employee who received excess unemployment compensation payments repay the overpayment. Sometimes this can be done by adjusting future payments to correct the error. Alternatively, the agency may require a lump-sum repayment. In some states, the worker can apply for a repayment waiver after a non-fraudulent overpayment.
Adjudicating Overpayment and Waiver
If the state determines that the worker was overpaid, he is entitled to a fact-finding interview in many states. After the interview, a decision is issued that the worker can appeal to the courts if the decision is unconstitutional, based on an error of law, or is not supported by facts in the record taken as a whole. An employee who loses all appeals can sometimes apply for a waiver if his overpayment was not fraudulent.
A waiver is different than an appeal and forgives some or all of the benefits a worker is asked to repay. Often a worker applies for a waiver by letter to the state unemployment department or agency. The letter should set out the reasons the individual cannot repay the overpayment. If the waiver is granted, the overpayment will be forgiven or limited.
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