Voluntarily Quit a Job? How It Can Impact UI Benefit Eligibility
Voluntarily Quit – UI Impact
Every employer should understand that each state has its own laws regarding unemployment insurance (UI) benefits.
When it comes to an employee who has voluntarily quit, each state is different in determining benefit eligibility. In some states, an employee can be disqualified from receiving unemployment insurance benefits if they “left the job voluntarily without good cause attributable to the work.” Other states may allow a claimant to collect UI benefits if they voluntarily quit with good cause – which does not necessarily have to be work-related.
All states interpret quitting a job differently. For instance, the NJ Department of Labor and the courts interpret the language “attributable to the work” to mean that a person is disqualified, unless something at work caused the person to stop working.
“Good cause attributable to the work” means a reason that is directly related to the job, a reason that was so compelling, that any reasonable person would have also made the same decision to leave their position.
The unemployment office must look at each case separately because every work situation and worker is different. The expectation is that the employee would have acted reasonably to try and keep their job, not to put up with unreasonable working conditions.
The reasons behind why an employee leaves or voluntarily quit their job can directly impact whether or not they’ll receive UI benefits. Quitting without a good reason could mean facing a benefit disqualification. For instance, in the state of New York, a disqualification for voluntarily quit lasts until the employee starts work again and earns at least ten times their benefit rate. Once they have earned enough from employment to end the disqualification, they must also be out of work again through no fault of their own.
Leaving Work for Personal Reasons
An employee could leave a company for personal reasons and because of that, they may be subject to disqualification from their UI benefits. Depending on the State, the Department of Labor can define “personal reasons,” differently.
This is a list of typical personal reasons an employee leaves a company:
- Leaving to start their own business
- Leaving to follow a family member who is moving
- Leaving because they no longer have child care
- Leaving because they don’t have transportation to work
- Leaving to go back to school
- Leaving because they lost their housing
- Leaving because they were incarcerated
Leaving One Job to Take a Better Job
When an employee resigns from one job to take a better job, it may change their UI eligibility if the second job doesn’t work out. For instance, if they are separated from the second job before they have worked long enough or earned enough to establish new unemployment claims, they may not be eligible.
Some people believe that if an employee resigns from their job voluntarily, they cannot collect UI benefits and if they are terminated, they can collect benefits. These notions are obviously not true. It is possible for someone to voluntarily quit a job and collect benefits and it’s also possible for someone to be discharged and not be able to collect UI benefits.
There are many factors that go into deciding UI eligibility after someone leaves their job for a better one. For example, recent NJ state law states that an employee will only be eligible to receive UI benefits if:
- They started the second job within seven days of leaving the first job*; AND
- They made at least as much money in the second job as the first, and worked at least as many hours in the second job as the first.
Whatever the circumstances, it’s important to consider the reasons why an employee has left your company and what impact that may have on their ability to collect UI benefits. It’s always wise to consult with a third-party that can help manage the UI process to avoid the possibility of legal mistakes or complications.