Calculating Your Weekly Benefit Amount
If you are eligible to receive UI benefits, you will receive a weekly benefit amount of approximately 50% of your average weekly wage, up to the maximum set by law. As of October 2, 2022, the maximum weekly benefit amount is $1015 per week. Follow the steps below to calculate the amount of unemployment benefits you may be eligible to receive each week.
Step 1: List your total wages in the last 4 quarters in which you worked.
Step 2: Add the top two highest quarters of wages.
In this example, Quarter 3 and Quarter 4 were the highest quarters:
$8,840 + 10,000 = $18,840
Note: If you worked 2 or fewer quarters, use the highest quarter of wages.
Step 3: Divide the sum of the two highest quarters from Step 2 by 30
$18,840 ÷ 26 = $724.61
In this example, $724.61 is your average weekly wage.
Note: If you worked 2 or fewer quarters, divide the highest quarter by 13 weeks to determine your average weekly wage.
Step 4: Divide your weekly wage from Step 3 in half to determine your weekly benefit amount.
$724.61 ÷ 2 = $362.30, rounded to the nearest dollar = $362
In this example, $362 is your weekly benefit amount.
Unemployment Insurance As Economic Stimulus
Unemployment benefits are designed first to relieve distress for jobless workers and their families. In recessions and the early stages of recoveries, however, they provide an additional benefit: stimulating economic activity and job creation. In fact, a major reason Congress created the basic UI program during the Great Depression was to help boost the economy and jobs.
The problem for most businesses in an economic slump is not lack of capacity to meet existing demand but lack of demand to fully utilize their existing capacity. To stop the destruction of jobs and begin to put people back to work, it is critical to stimulate demand. One of the best ways to do this is to target financial relief toward unemployed workers who need a replacement for lost income. People whose income is disrupted in a recession and who lack the savings to tide them over are the ones most likely to spend quickly any added income they receive. Thus, policies that put customers in stores with money to spend will likely do more to close the output gap and create jobs than, for example, business tax breaks.
A Labor Department report commissioned during the George W. Bush Administration and released in 2010 reinforced CBOs conclusion. It found that in the depths of the Great Recession, federal emergency UI benefits boosted employment by about 750,000 jobs.
Collection Of Unemployment Data
Official U.S. employment statistics are produced by the BLS, an agency within the Department of Labor . Every month the Census Bureau, part of the Department of Commerce , conducts the Current Population Survey using a sample of approximately 60,000 households, or about 110,000 individuals.
The survey collects data on individuals in these households by race, ethnicity, age, veteran status, and gender , all of whichalong with geographyadd nuance to the employment data. The sample is rotated so that 75% of the households remain constant from month to month and 50% from year to year. Interviews are conducted in person or by phone.
The survey excludes individuals under the age of 16 and those who are in the Armed Forces . People in correctional facilities, mental health care facilities, and similar institutions are also excluded. Interviewers ask a series of questions that determine employment status, but do not ask whether respondents are employed or unemployed. Nor do the interviewers themselves assign employment status they record the answers for the BLS to analyze.
Interviewers also collect information on industries, occupations, average earnings, and union membership. For those who are jobless, interviewers also ask whether they quit or were discharged .
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State Unemployment Tax Employer Liability
Similar to how the federal UC program is funded in order to fund each states unemployment compensation program almost all the states impose unemployment taxes directly on employers. Also similar to the federal system is the fact that apart from a few states, you do not withhold these taxes from your employees wages.
If you have employees in New Jersey, Alaska, or Pennsylvania you will also be withholding unemployment taxes from your employees wages since these states assess unemployment taxes on employees.
How Your Base Period And Benefit Year Are Determined
Massachusetts employers are required to report wage information to the Department of Unemployment Assistance on a quarterly basis. This wage information is used to determine whether you have earned enough wages to qualify for unemployment benefits.
If you disagree with the wages reported by your employer
If you disagree with the wages reported on your Monetary Determination notice, you can provide proof of the wage amounts you are disputing by completing and returning the Wage and Employer Correction sheet that was mailed to you with your notice. DUA will review the information and make any necessary adjustments.
If it is determined that you have not earned enough wages under either the primary or the alternate base period, you have the right to file an appeal and present additional supporting documents at a hearing.
Your benefit year
Once your claim is established, it will remain open for 1 year . This period of time is called your benefit year.
Your maximum benefit credit is available to you for the duration of your benefit year or until you have exhausted your maximum benefit credit. Once your benefit year expires, any unpaid benefits will no longer be available to you.
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Unemployment Rate And Covid
In response to pandemic-related closures or business cutbacks, unemployment in the United States achieved historic records. In May 2020, 49.8 million individual reported they had been unable to work at some point in the prior four weeks because their employer closed or lost business due to the pandemic. The unemployment rate increased from 4.4% in March 2020 to 14.8% in April 2020, achieving levels not seen since the 1930s.
The impacts of COVID-19 were experienced across the nation, as every state in the United States experienced a higher unemployment rate than what was recorded during the Great Recession. However, unemployment rates disproportionally impacted different sectors:
- Financial Activities: The unemployment rate in May 2020 was 5.7%, while the unemployment rate in July 2021 had improved to 3.0%.
- Leisure and Hospitality: The unemployment rate in April 2020 was 39.3%, while the unemployment rate in July 2021 had improved to 9.0%.
- Wholesale and Retail: The unemployment rate in April 2020 was 17.1%, while the unemployment rate in July 2021 had improved to 6.0%.
How Much Will I Receive In Weekly Benefits
You can calculate your potential benefits online. Your weekly benefit amount and the number of weeks of entitlement are based on the wages you were paid and the amount of time you worked during your base period. The weekly benefit amount is calculated by dividing the sum of the wages earned during the highest quarter of the base period by 26, rounded down to the next lower whole dollar. The result cannot exceed the utmost weekly benefit permitted by the rule. This is a state-specific parameter and is dependent on the states budget and unemployment rate.
The base period is the term used to describe the time frame used as the basis for deciding whether or not you will be monetarily eligible for unemployment.
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The District Of Columbia
The weekly benefit amount in the District of Columbia is 1/26 of your earnings in the highest quarter of your base period.
The minimum weekly benefit amount a Washingtonian could receive is $50 and the maximum is $444.
If you collect income while on unemployment benefits, the District of Columbia will disregard 1/3 of wages plus $50.
The maximum coverage for unemployment benefits is 26 weeks.
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Unemployment Benefit Replacement Rates During The Pandemic
Due to federal relief efforts, two-thirds of unemployed workers are receiving benefits larger than their lost earnings, and a fifth are receiving benefits that are at least double their lost earnings.
Paying unemployment insurance benefits to those who lose their jobs provides them with financial support as they look for work. If a state sets benefits too high, it may discourage job-finding and delay beneficial labor reallocation. If benefits are too low, the unemployed may suffer from inadequate resources to sustain a minimum standard of living.
In US Unemployment Insurance Replacement Rates during the Pandemic, Peter Ganong, Pascal J. Noel, and Joseph S. Vavra calculate the distribution of unemployment insurance benefits under the Coronavirus Aid, Relief, and Economic Security Act. Under this legislation, the federal government added $600 per week to state unemployment insurance benefits. As a result, the researchers estimate, half of the eligible unemployed are now entitled to total unemployment benefits that replace at least 134 percent of their lost wages. Two-thirds are eligible for benefits larger than their lost earnings, and a fifth are eligible for benefits that at least double their lost earnings.
Linda Gorman
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Supplemental Unemployment Insurance Benefits During The Coronavirus Pandemic
The CARES Act and the American Rescue Plan established the following supplemental unemployment insurance programs during the coronavirus pandemic:
- Federal Pandemic Unemployment Compensation
The Federal Pandemic Unemployment Compensation program aimed to provide qualifying unemployment insurance claimants with a supplemental $300-$600 per week in addition to their state unemployment insurance benefits. The program expired on September 6, 2021.
- Pandemic Emergency Unemployment Compensation
The Pandemic Emergency Unemployment Compensation sought to provide 24 weeks of extended unemployment insurance benefits to recipients who have exhausted their standard benefits. The program expired on September 6, 2021.
- Pandemic Unemployment Assistance
The federal Pandemic Unemployment Assistance program aimed to provide individuals who are out of work but ineligible for standard unemployment insurance benefits with $300-$600 in weekly compensation. Qualifying individuals included workers who are not eligible for standard benefits, such as independent contractors and self-employed workers, as well as individuals who have exhausted their standard benefits, extended benefits, or PEUC benefits. The program expired on September 6, 2021.
- Lost Wages Assistance
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How To Claim For A Benefits Extension
If you are presently filing weekly claims for unemployment benefits, carry on filing your weekly claim if you are jobless or are working reduced hours. They will inform you by mail if you are eligible for the added benefits.
Usually, two programs will extend unemployment insurance benefits: Emergency Unemployment Compensation and Extended Benefits . It is beneficial for those that are out of work for a long period. The maximum benefits duration has increased from 26 to 99 weeks in some states.To be eligible for EUC benefits you must:
****The EUC expired on January 1, 2014, and since has not been renewed by Congress***
To be eligible for Extended Benefits , you must:
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How To File Your Weekly Claim
After you file your application for unemployment benefits, you must start filing your weekly claims. You require filing each week, even though you are:
You can file your weekly claim:
- Through the Internet You can file your weekly claim online. You must have a User ID and PIN to file your weekly claim online.
- File every week that you want to claim benefits and keep on filing until you go back to work, run out of benefits or stop seeking work. You will receive your unemployment benefits one week after filing the claim.
The Best And Worst States For Unemployment Benefits
To determine the best and worst U.S. states for unemployment benefits, Forbes Advisor analyzed the average weekly benefit, benefit length and cost of living index for each state and the District of Columbia.
Cost of living is typically calculated by comparing the costs of food, housing, utilities, transportation, health care and miscellaneous goods and services. The higher the number, the more expensive it is to live in that state.
Four of the top five statesKansas, North Dakota, Wyoming and Texasoffer a maximum of 26 weeks of unemployment benefits. No. 5, Massachusetts, offers four more weeks, but has a considerably higher cost of living than the other locations.
The bottom five statesCalifornia, Alaska, North Carolina, Arizona and Floridahave lower average weekly benefits relative to their cost of living.
Its important to note that some states have benefit periods that can fluctuate depending on their unemployment rate. Utah, for example, offers just 10 weeks of benefits when unemployment is low it increases to up to 26 weeks when unemployment is high.
Looking at benefit weeks and cost of living provides a more complete picture of unemployment insurance in each state. But examining the top and bottom states based on average benefit payment reveals a lot about how that state structures its benefits.
Meanwhile, Louisiana has an average weekly payment of $192 and a weekly maximum of just $247.
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Unemployment Insurance Tax Rates For 2021
Due to the COVID-19 pandemic, the Division of Unemployment Insurance has paid over $1.5 billion in Unemployment Insurance benefits from the Unemployment Insurance Trust Fund. Because of the balance of the Trust Fund, Tax Table F will apply to employersâ unemployment insurance tax rate for 2021:
- The range of tax rates for contributory employers in 2021 will be between 2.2% to 13.5%, which is the Table F tax rate schedule.
- The rate for new employers will be 2.3%. Under Maryland UI law, there is a separate rate for new employers that are in the construction industry and headquartered in another state, which will be 7.0% in 2021.
- The taxable wage base for 2021 will remain at $8,500.
Employers may also opt for opt for payment plans in 2021. Employers may request a payment plan via their BEACON portal. Please contact the Employer Call Center with any questions you may have regarding payment plans at 410-949-0033 or by completing the UI Inquiry Form and choosing Payment Plan from the employer or TPA drop down menu.
There are some employers who will be negatively impacted by the Executive Order and receive a higher tax rate. For these employers, the Executive Order offers flexibility and their tax rate will be calculated as it normally would be and will be based on their experience during fiscal years 2018, 2019, and 2020.
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The first program, known as Pandemic Emergency Unemployment Compensation , extends unemployment benefits by an extra 13 weeks when state unemployment payments expire.
The second, called Pandemic Unemployment Assistance , allows the self-employed, including most gig workers and freelancers, to qualify for benefits if they meet certain criteria. Those who cant work because they have Covid-19, are under quarantine, or are caring for a children whose school has closed due to Covid-19 are also eligible for unemployment under PUA.
Both programs close to new claimants on March 14, 2021, and expire for existing claimants on April 5, 2021.
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How Much Can I Get Each Week
In Washington state, this is how your weekly benefit amount is calculated:
Step 1: We add together the gross wages from the two highest quarters in your base year, then we divide by 2.
Step 2: Multiply the amount in step 1 by 0.0385.
- If this is more than Washingtons official maximum weekly benefit amount of $999, you will get $999.
- If this is at least $317 and not more than $999, you will get this amount, rounded down to the nearest dollar.
- If this is less than $317, we go to step 3.
Step 3: We calculate your weekly wage. We take the amount calculated in step 1, multiply by 4 and divide by 52 weeks. That equals your estimated weekly wage.
Step 4: Then we compare your estimated weekly wage to $317. You will get the lesser amount, rounded down to the nearest dollar.
Examples of weekly benefit amount calculation:
|
Step 1: |
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$999 |
How Is The State Unemployment Tax Calculated
Like other payroll taxes, you pay SUTA taxes on a percentage of each employees earnings, up to a certain amount.
Your SUTA tax rate falls somewhere in a state-determined range. States assign your business a SUTA tax rate based on industry and history of former employees filing for unemployment benefits. New companies usually face a standard rate.
Each state decides on its SUTA tax rate range. The ranges are wide: Kentuckys range, for example, is 0.3% to 9%.
Each state also decides on an annual SUTA limit so that an employees earnings after that amount are no longer taxed until the following year.
You might know that Social Security taxes stop after an employee earns $137,700 for the year. The SUTA limit, also called a SUTA wage base, is the same concept.
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Understanding Your Base Period And Benefit Year
The amount of UI benefits you may be eligible to receive is determined by wages paid to you during either your primary or alternate base period. The base period is defined by Massachusetts law.
Primary base period
The primary base period is the last 4 completed calendar quarters prior to the effective date of your claim . For most claimants, the primary base period is used to calculate your maximum benefit credit, which is the total amount of benefits you are eligible to receive.
Alternate base period
The alternate base period is the last 3 completed calendar quarters and the period of time between the last completed quarter and the effective date of your claim. The alternate base period can only be used if:
- You don’t meet the minimum eligibility requirements using the primary base period
- Using the alternate base period will increase your maximum benefit credit by 10% or more
