Can You Collect Unemployment During Your Furlough?

With national unemployment rates at an all-time high, many employers have had to find novel ways to cut their operating costs and overhead expenses. During these temporary work furloughs, you may wonder if you can collect unemployment. Most employers do not want to cut their entire staffs for many reasons. Typically, employers in most states have to pay higher unemployment taxes if they have a history of permanently laying off their employees.

In some states, employers who conduct systematic furloughs or temporarily cease their operations are not charged higher tax rates. Another reason employers may not want to permanently layoff their employees is that the federal WARN or Worker Adjustment Retraining and Notification Act requires employers to provide their affected employees with written notice at least 60 days before laying them off if they conduct mass layoffs. Finally, employers who layoff their employees due to lack of work may find they acted prematurely when their business activities pick back up, and they must expend more money to hire a new set of employees and train them.

Furloughs make economic sense for many employers, including state and government employers. However, although only temporary, furloughed employees are still unemployed. During a furlough, you may need to find temporary work or apply for unemployment insurance compensation to pay your bills. In many states, furloughed employees are prohibited from collecting unemployment insurance benefits.

In Virginia, you may be able to collect unemployment compensation temporarily during your furlough. The Virginia Employment Commission requires unemployed applicants to serve a mandatory waiting week before becoming eligible for benefits. Because unemployment benefits start after a one-week waiting period and one-week period of unemployment, your furlough must last at least two weeks to qualify for unemployment insurance. Furthermore, if your employer allows you to subsidize your furlough by cashing in unused sick or vacation days, your compensation from these fringe benefits is income, and the Virginia Employment Commission reduces your weekly benefits on a dollar-for-dollar basis once you earn over $50 per week.

Contact my office today at (703) 454-5147  for an initial consultation to discuss your furlough unemployment rights in Virginia.