Your Unemployment Insurance claim and your back pay claim are separate claims. Your State Unemployment Insurance Division processes your UI benefit claim, while an appropriate division or agency under your State Wage and Hour Division does the same for your back pay claim. However, your back pay award may affect your UI benefit amount and your continued eligibility. After you appeal a decision to deny your unemployment benefits, if you win, it may take up to two weeks until you start receiving payments.
The U.S. Department of Labor defines back pay as payment for either unpaid or underpaid work you performed for your employer. The Fair Labor Standards Act forms the legal basis for all wage claims. The WHD may supervise the handling of back pay claims. The appropriate division, bureau or agency under your State WHD handles the processing and resolution of your back pay claim against your employer. Resolution covers the schedule of payment of back wages due to you. However, the financial standing of your employer may affect the promptness of your back wages payment.
Back Pay and Your UI Benefits
The computation of your total UI benefit amount includes your back pay award. For UI purposes, the same treatment applies to back pay and wages earned when you were employed. States use varying formulas and "base periods" for computing your UI benefits. For example, Wisconsin's Unemployment Insurance Division uses different formulas for computing different back pay claims cases. First, it factors in base periods according to whether you worked or did not work during the designated base period for your case, and then it factors based on whether you received the back pay award under state or federal law, or under a collective bargaining agreement.
During an Appeal Period
Your timely receipt of UI benefits partly depends on your continued application for payments. This is relevant even during periods when you are not receiving your UI benefits, such as during an appeal period. During an appeal period, you must continue to apply for your UI benefits for every week that you are unemployed and eligible for payment. Some states require weekly filing of claims, while others require a bi-weekly claim-filing schedule. After winning your appeal, you receive your benefits only for those weeks for which you filed a claim.
After an Appeal Period
Usually, you start receiving your payments after winning an appeal on the third week after the moment you were notified that you are eligible to receive benefits. If you receive your UI checks after winning an appeal and receive your back pay award, your State UID must determine if you received an overpayment. State UIDs require the return of any overpayment you received. You are not eligible for UI benefits during periods covered by your back pay awards. In North Carolina, the law requires that employers ordered to pay back wages to a UI claimant deduct the amount of overpayment from the back pay award. In Texas, an employer who awards reduced back pay to a UI claimant due to the UI benefits deducted from it, must reimburse the State compensation fund for the amount deducted. In California, a similar policy for UI benefits and back pay awards applies.
- United States Department of Labor: Back Pay
- Colorado Department of Labor and Employment; Unemployment Insurance: Frequently Asked Questions About ICAO Unemployment Appeals
- State of Wisconsin Department of Workforce Development; Wages and Other Kinds of Income; B. Treatment of Wages and Other Types of Income; January 2009
- The Employment Security Commission of North Carolina: Unemployment Insurance Information
- Minnesota: Unemployment Insurance FAQs
- Texas Labor Code: Employment Services and Unemployment