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I am going to be anonny as I do not want people to know who I am and call me lazy or whatever they decide to call me. I lost a job not long ago, found another one for peanuts, but am going to turn them down as I can get more unemployment. Plus with unemployment, I know how much I can count on each week. It is steady. I know it will not last forever, but.... I am just tired of the stress and worry of is there going to be any work. At least now I know how much I will get each week. At least for 6 months.
I would like to clear up some misconceptions about Unemployment Compensation Benefits. Here are the FACTS.
Many employees think that Unemployment Compensation is “my money – I pay into it.” That is not correct. An employee never has had any money deducted from their paycheck that goes towards the Unemployment Trust Fund. If you look at your paycheck stub, you will find State and Federal Taxes, Social Security, and other voluntary deductions, such as insurance, 401K, etc, but there will NEVER be a deduction called “unemployment.” So, therefore, if you collect Unemployment, you are NOT getting back money you already paid into the Fund.
However, that is not to say that an Employer does not take this into account when they offer you a salary. It could very well be that someone who gets raises (obviously not Medical Transcriptionists) will not get as high a raise if the Employer has had to lay off people and their Unemployment Trust Fund obligation has increased. In the case of Medical Transcriptionists, it could be why the Employer is paying 8 cents a line instead of 9 cents a line. Employers ALWAYS have a way to make the employee get the short end of the stick.
A lot of people do not know how Employers are charged for Unemployment insurance. For those who do not, here is how it works.
Unemployment is paid by the State government. Employers pay into a fund based upon the number of employees they have. The State government collects the money paid in and puts it into a trust fund. Unemployment benefits are then paid out from the trust fund. The amount of money (unemployment insurance premiums) an Employer pays is based upon their history of payouts. A company that has high numbers of payout will pay more per employee then will a company who fires or lays no one off (like auto insurance - a person with more accidents on their history pays higher premiums then a driver with a clean record). This can range from 0% to 6% of taxable payroll. They also have to pay an Administrative Tax to the State, who has to keep track of the UC Claim and print out the check, etc. This is also a percentage. It gets pretty complicated after that.
That is why Employers fight every new Unemployment claim. They are notified every single time someone puts in a Claim (even if the Claim is denied for some reason and that person never receives a penny in Unemployment Compensation).
If you are thinking about applying for Partial Unemployment because you are not getting enough lines, you should really think hard about it first.
It is one thing to piss off a former Employer (especially if you were fired and never plan to work for them again) and another to piss off your current Employer. So you really have to be sure the amount of money you can get from your Employer in Unemployment is worth the pain they can inflict on you. We all know Employers who make life miserable for an employee by giving them the god-awful dictators and QA them to death in order to get them to quit so they do not have to pay Unemployment Compensation.
Hope this clears up some misunderstandings.
Good Luck to anyone having to deal with this situation. I hope you all find better jobs.
Wow, I guess research only goes so far. I spent a lot of time researching different State payroll withholdings and thought I had checked enough of them to get the full picture.
Lucky you. You live in 1 of 2 States that do deduct SUI (New Jersey and Pennsylvania are the only States that have employee unemployment deductions). I did not count Alaska because it is so minimal (In Alaska, there is an employee withholding of 1/2% for unemployment coverage, with a maximum deduction of $150.50 per year).
Only 5 States have disability deductions (California, Hawaii, New Jersey, New York, and Rhode Island). So, actually, double lucky you – you live in the only State with both.
I guess I should have checked all 50 States (well actually, only 42, since 8 States have no State Income Tax deductions).
Thanks for your reply. I love to learn something new. If I ever decide to move to another State, I will have to remember this. LOL
Have a great day.
The Federal-State Unemployment Compensation (UC) Program
The Federal Unemployment Tax was mandated via the Federal-Unemployment Tax Act (FUTA), and it requires employers to pay (1) a federal unemployment tax and (2) a state unemployment tax.
The tax payments are shouldered by the employer alone and should in no way be deducted or collected from the employees.
(1) The Federal Unemployment Tax
Employers are required to pay 6.2 % on the first $7,000 paid as compensation to each employee for the entire calendar year. The purposes of this federal unemployment tax are the following:
Provide the federal government working funds in administering or extending unemployment compensation benefits to eligible employees.
Provide funds using part of the tax proceeds for one-half of the cost of unemployment benefits claimed by the eligible employee claimant.
Provide funds from which a state can borrow, in case it does not have enough funds to meet the unemployment compensation claims of its eligible employees.
(2) The State Unemployment Compensation (UC) Tax
In addition to the federal unemployment tax, employers are also required to pay State UC taxes to provide unemployment funds to eligible workers. The tax rate varies in every state because it is based on the state’s unemployment rate at the time of tax filing. It follows, therefore, that if the number of unemployed in a particular state increases, the tax rate for state UC tax also increases; thus the employer‘s tax payment becomes higher.
On the other hand, employers that represent the state sector with low unemployment experience with rates lower than 5.4% are entitled to receive additional credits in their UC contribution fund. Any difference between the taxpayer’s actual UC tax payments against the amount paid if computed at 5.4% will be added as additional credit to the taxpayer’s accumulated Unemployment Compensation fund for the benefit of the employer’s laid-off workers.
(1) Who Provides the Funds for the Unemployment Compensation Benefits?
Based on the above explanations, we are drawn to the conclusion that the answer to this query would be the employer, albeit collected and administered jointly by the federal and state governments.
The Federal-Unemployment Tax Act (FUTA) is actually a system by which employers are forced to set aside funds in order to benefit unemployed workers who were rendered jobless as a result of downsizing or due to unforeseen events or circumstances that rendered the employee unemployed through no fault of his own. Hence, those who were terminated for cause or who voluntarily resigned from employment are not considered as “eligible unemployed workers.”
The state UC taxes are also referred to as UC contributions and an employer, who is not exempt from paying this contribution, will have to pay penalties, interest and/or special administrative taxes for any failure to remit the UC tax or contribution.
Federal laws also require that the state UC tax will be used only as funds to meet the unemployment compensation benefit claims of eligible unemployed workers.
Who are the Employers Being Required to Pay the UC Tax?
Employers who paid wages to employees in the amounts of $1,500 or more in any quarter during 2008 and 2009.
Employers who had workers under their employment for even a fraction of a day for at least 20 or more different weeks in 2008 and another 20 or more different weeks in 2009. This is regardless of employee status, whether full time, part time, or temporary.
Employers who hired household help whether in private homes, in local college clubs, or in a local chapter of a college fraternity or sorority and paid cash wages of $1,000 or more in any quarter of the calendar year for 2008 and 2009.
Agricultural employers who paid $20,000 or more as compensation to farm workers in any given quarter of 2008 and 2009.
Agricultural employers who employed 10 or more farm workers for even a fraction of the day not necessarily on a per-day head count but on a collective basis for at least 20 different weeks in 2008 and another 20 different weeks in 2009.
@RLee, I just want you to be aware of a few facts regarding your Unemployment. In all probability, you will NEVER see 99 weeks of Unemployment Compensation, even if you find part-time work and continue to receive partial benefits. The last two Federal Tiers (as extended by Congress) were contingent on your State’s average Unemployment Rate. In order to receive Federal Tier 4 benefits (the final extension for up to 99 weeks), your State had to have an Unemployment Rate average over 3 months of 8.5%. I believe in one of your previous posts, RLee, you mentioned that you live in Maine. I looked up the 3-month average currently in Maine, and it is 8%. It is highly unlikely that Maine’s average 3-month Unemployment will rise above 8.5% in the next six months, as the National average is either declining or holding steady. Also, if your State’s Unemployment average continues to drop, you may not be eligible for Federal Tier 3 Unemployment Benefits either. (You are currently in the 20-week Federal Tier 1 – next is a 14-week Federal Tier 2.) I do not know how many weeks into your 20-week Federal Tier 1 you are currently at, but if at any time over the remainder of your 20-weeks, if Maine falls below that magic average percentage, you will not be allowed to move into the next Federal Tier. They will allow you to finish the Tier you are in, but you will not get any more after that. Remember, only the first 26-weeks are guaranteed by the State. After the first 26-weeks, which is State-based, the rest is all Federal Taxpayer money and Congress imposed requirements that have to be maintained in order to continue to the next Federal Tier. You can get cut off at any time. The worst part is that they may not even tell you until 2 or 3 weeks prior (because they have to wait for new monthly Unemployment figures every month) that you will not be going any more money and they will just cut you off.
Two other pieces of information you may not be aware of. That extra $25 per week ends sometime in December. No one filing now will receive it.
Also, the Federal Tiers expire November 30, 2010. Congress has to vote to extend them. That means, if the elections in November turn Congress upside down, in all probability, those extensions will not pass again. Therefore, after November 30, 2010, you will be able to finish the Tier you are in, but you will not get anything more after that.
What I am trying to say is that you should not count on 99 weeks of Unemployment Compensation. At this point in time, now that you are into Federal Tiers, you should really be thinking about a back-up plan just in case the Feds pull the rug out from under all the current unemployed. Make sure you read all the updates on your State’s Unemployment Website and, if they let you, talk to someone about how many weeks of Unemployment Benefits you realistically can expect to receive.
To anyone else contemplating Unemployment, this will go for you too. At this point in time, it is highly unlikely that anyone starting to receive Unemployment Benefits this month will be able to receive 99-weeks’ worth, even if they are legitimately having difficulty finding a decent-paying job and are still not working 99 weeks into the future.
I just want to be sure everyone is fully informed of what they can expect if they file for Unemployment in the coming months.