Definition of Unemployment Benefits

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Individuals terminated from their employment may qualify for unemployment benefits for a certain period of time. However, there are certain qualifications you must meet when filing a claim with your state's unemployment office.

Purpose

Unemployment benefits serve the purpose of providing short-term income for unemployed individuals who meet certain eligibility requirements. These monetary payments are weekly allowances that help individuals with their financial needs while pursuing employment. Unemployment benefits are not meant to replace total income but provide only a percentage fo the rate received with the prior employer.

Eligibility

Applicants for unemployment benefits must provide the required information to qualify for the unemployment insurance. The eligibility requirements and the amount of compensation for unemployment benefits depend on a combination of state and federal law, though all state programs must be approved by the US Secretary of Labor. The requirements to qualify for state unemployment programs vary by state, however, most states will not approve an application for unemployment benefits if the applicant's employment was terminated due to misconduct.

Compensation

An individual's actual amount of unemployment income is calculated based upon the income rate with the prior employer. Usually, state unemployment programs will pay half of the individual’s weekly income. However, the benefit amounts are determined by state statutes. Individuals who intend to start a business after losing a job, rather than look for other employment, may qualify for special benefits.

Types

The most common unemployment insurance is the State Unemployment Insurance Program, applied for at the state unemployment office and based on state eligibility requirements. Other programs include the Extended Benefits Program and the Self-Employment Assistance program. Under the Extended Benefits Program a state experiencing a high rate of unemployment can provide 13 weeks of extended coverage to individuals who have reached their maximum. Under Self-Employment Assistance, individuals who qualify and want to start their own business can apply for a weekly self-employed allowance. The United States Department of Labor Website provides a listing of all of the various types of available unemployment insurance benefits and the eligibility requirements for each.

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