The unemployment insurance program is a cooperative system between the federal government and individual states, and it's been around since 1935. Employers pay unemployment taxes, and employees do, too, in a handful of states. When and if employees find themselves out of work, they can put in a claim for unemployment benefits from those tax funds.
There's a cap on how much in the way of benefits you can receive, and they usually work out to about half of what you were earning while employed. The rules are largely set by states, but the federal government can and does step in when the nation is in crisis, such as during the 2020 coronavirus pandemic.
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Why Are You Out of Work?
The first ironclad rule is that you can't collect unemployment benefits if you quit your job, nor if you're fired due to negligence or misconduct. Your separation from your employer must occur due to factors outside your control. And most states, including New York, require that you actively search for a new job while you're collecting benefits.
New York's Base Period
New York uses a "base period" for benefit calculations. The state's base period equals one year: the first four of the last five calendar quarters. Calculations begin with what you earned during this period.
But New York is somewhat flexible. It will use your "alternate base period" instead if you didn't earn a sufficient amount in your base period for optimum benefits available to you. The alternate period is the last four quarters. This method effectively tosses out that last, fifth quarter. Wages earned in the quarter you apply for benefits aren't included.
Rules Regarding Earnings
New York will let you collect unemployment benefits if you didn't work for a full year, but the calculations as to how much you can receive will be somewhat different. You must have worked for an employer who paid unemployment taxes in at least two quarters.
Under normal circumstances and absent a national crisis, you must earn at least $2,600 in one quarter as of 2020 to be eligible for benefits, and your overall earnings during your base period must be at least 1.5 times as much as you earned in your highest-paid quarter.
How to Calculate Benefits
New York obligingly provides an interactive calculator on its Department of Labor website that will basically figure all this out for you, although the site warns that it's not a guarantee of how much you'll receive after your file is reviewed.
An annual income of $35,000 works out to $8,750 per quarter, assuming your hours and earnings didn't fluctuate from month to month. This works out to about $2,917 a month, or $729 a week. You'd receive $336 a week using either the base period or the alternate base period calculation, according to the interactive calculator. This is somewhat less than the half-your-earnings estimate.
You can request that the state calculate your benefits using your alternate base period if your income isn't consistent over each and every quarter and you think your benefits would be more based on this other method. New York won't automatically try both calculations, however, so it's up to you to ask.
Minimum and Maximum Limits
New York's cap on benefits is $504 a week beginning in October 2019. Minimum benefits are $100 a week beginning in January 2020, absent a national emergency like the coronavirus pandemic. The maximum payment will increase a little each year through 2026, at which time it should reach approximately half of the state's average weekly income for citizens.
Effect of the CARES Act
The impact of COVID-19 prompted the federal government to pass the Coronavirus Aid, Relief, and Economic Security (CARES) Act, which was signed into law on March 27, 2020. The act includes provisions for the Pandemic Emergency Unemployment Compensation, or PEUC program, as well as the Pandemic Unemployment Compensation, or PUC program, and Pandemic Unemployment Assistance, or PUA program. New York adjusted at least one of its provisions as well.
- Normally, there's a one-week waiting period before benefits can begin in New York, but the state waived this effective March 12, 2020, due to the pandemic.
- The limit for collecting benefits is normally 26 weeks per calendar year, but the PEUC program adds another 13 weeks.
- The PUA extends benefits to self-employed workers, gig workers and independent contractors who wouldn't normally qualify for the state's unemployment program.
Finally and best of all, the PUC program kindly increases your benefits by an additional $600 a week. That $336 a week based on an income of $35,000 increases to $936 to help you get through, at least until this provision expires on July 31, 2020. The CARE Act's provisions might be extended, however, so stay tuned.
- New York State Department of Labor: Estimate Weekly Unemployment Insurance Benefits
- New York State Department of Labor: How Your weekly Unemployment Insurance Benefit Payment Is Calculated
- New York State Department of Labor: Unemployment Insurance Benefits – Frequently Asked Questions
- New York State Department of Labor: Pandemic Unemployment Assistance
- The Brookings Institution: How Does Unemployment Insurance Work?