Oct 9 2024
Josh Goodbaum: Hi, Amanda.
Amanda DeMatteis: Hi, Josh. What are we going to chat about today?
Goodbaum: I wanna talk about unemployment. We did a video earlier this year about the interaction between unemployment benefits in Connecticut and severance payments, and we spelled out for Connecticut employees that there was a change in the law in 2024 that said that severance payments are now an offset against Connecticut unemployment benefits.
That was almost a year ago, and we still get a lot of questions about this and, in particular, people want to know: “Well, is there anything I can do to get both severance payments and unemployment benefits?” What can you tell the folks at home?
DeMatteis: There are a lot of questions about this issue – not only from employees in Connecticut, Josh, but even from employment lawyers who have been doing this a long time, because this is a really extreme change. We have some additional guidance that might be helpful for employees in Connecticut to understand if they find themselves in the position of being otherwise eligible for unemployment benefits.
Here’s the big takeaway: You cannot receive unemployment benefits for weeks when you are also receiving severance pay. So, what does that mean? Let’s use an example to try to illustrate this a little bit.
Say you’re terminated on September 30th and your employer has said, “I’m going to give you four weeks of severance benefits.” Let’s assume those severance benefits begin immediately after your last day of employment, which is September 30th. You would then be receiving severance benefits for approximately the whole month of October, from October 1 to October 28. You would not be eligible to receive unemployment benefits during those weeks that your employer is paying you severance pay. However, if you’re still unemployed on October 29 – at the end of that four-week severance period – and are otherwise eligible to receive unemployment benefits, you very well could receive them. So, it’s just the overlap that’s the problem.
You could do the same example for four weeks or six weeks or 12 weeks, right? If you receive all of that severance pay from your former employer, you are not eligible for unemployment benefits pay in those weeks. But, at the conclusion of that severance, if you are still eligible to receive unemployment benefits, then you can go ahead and apply and you wouldn’t be barred from receiving them just because you received severance from your employer.
So, to answer your question, Josh: Yes, there is a way to both receive severance pay and be eligible for unemployment benefits. The big, big takeaway, though, is they can’t overlap.
Goodbaum: Great advice, Amanda. Any other tips you have for folks out there who are thinking of applying for unemployment?
DeMatteis: The number one piece of advice I could give is: Apply for unemployment. Otherwise, you’ll never know whether or not you’re eligible. Be sure to tell the truth on any application that you’re making for unemployment compensation. The last thing you would want is to be denied because you said something that wasn’t accurate or tried to work around the system. Always tell the truth.
Also, unemployment is still taking some time to get back to folks. So, if you apply for benefits and you don’t receive a response, make sure you are continuing to process your weekly applications because failure to do so in and of itself might render you ineligible for benefits for that particular week.
Goodbaum: All really important information for the folks out there. Thank you, Amanda. Thank you all for watching, and we’ll see you next time.
Posted by Garrison, Levin-Epstein, Fitzgerald & Pirrotti, P.C. in Commentary
Tagged Amanda DeMatteis, Joshua Goodbaum, Severance Agreements, Unemployment