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Behind Unemployment Disqualifications: What Employers Need to Know

By April 30, 2024May 21st, 2024No Comments
pointing to block with x. unemployment disqualification

An unemployment disqualification occurs when an individual who previously worked for your company files an unemployment claim but is found ineligible to receive benefits.

A disqualification can occur for various reasons, primarily concerning the claimant’s actions or circumstances during their employment and subsequent separation from the company.

While only a few reasons are directly associated with you as the employer, it is important to know why a claimant may be disqualified. It may also be helpful to understand common misconceptions associated with unemployment disqualification and why a claimant may or may not be qualified in these frequently addressed scenarios.

Types of Disqualifications

Separation Reason

One of the most common disqualifications occurs based on the reason for separation from the claimant’s most recent employer. A claimant can be disqualified for benefits based on separation reason if they are found to have been discharged for misconduct or if they voluntarily resigned without good cause. Both misconduct and good cause are defined by a state’s unemployment code and precedent, which is not always the same as the employer’s definition that led to the separation.

Monetary Eligibility

To qualify for unemployment benefits, a claimant must meet minimum monetary requirements (determined on a state-by-state basis). In most states, this means that they must have earned a certain amount in wages during their base period, otherwise known as the first four of the last five completed calendar quarters.

While some states do have alternate base periods and additional ways for claimants to qualify if they have not earned enough wages in the base period, this is a common way that claimants with a short work history or employment gap may be disqualified for benefits.

Able and Available

Another requirement that must be met to qualify for benefits is that a claimant must be able and available to work. Being “able and available” means that a claimant is physically and mentally capable of working and is actively seeking and available for suitable employment opportunities.

Work Search Requirements

job search on tabletEach state has minimum requirements that must be met associated with a claimant’s active and continual search for new work. Most states require a specific number of job search activities to be completed throughout the week.

Pay (Wages) Received

There may be instances where an individual files for unemployment benefits, but they are either not fully employed or fully unemployed but are receiving pay from their former employer. Any time a claimant is still earning wages in any capacity, they must report all applicable wages to the state workforce agency when certifying for unemployment benefits. This includes severance pay, paid time off, vacation pay, and holiday pay.

The state will take these wages and additional details about the wages (payment date, allocation date(s), etc.) and use them to determine if the claimant should have their benefits reduced or if – in instances where a claimant earns more than their weekly benefit amount – the claimant should be disqualified for a week or more of benefits.


When employers think of unemployment fraud, they most often think of fraud associated with identity theft and fraudulent filing without the individual’s knowledge. However, unemployment fraud is also classified as an individual who files for benefits while still working full[1]time and/or who does not appropriately report their earned wages. Fraud can also occur if an individual starts a new job but continues to file for benefits while waiting to receive their first check (and beyond).

It Starts with a Claim

The unemployment claims process – including applicable qualifications and disqualifications – always starts with an initial claim. By providing as much information and documentation as possible up front during the initial claim, employers can help ensure that the state workforce agency has a comprehensive understanding of the circumstances surrounding the former employee’s separation from employment. This helps minimize the risk of erroneous qualifications and reduces the likelihood of costly appeals or disputes down the line. Therefore, you should always ensure you respond with detailed, timely information to all claim requests!

Common Misconceptions

The claimant quit. Aren’t they automatically disqualified?

No, a claimant is not automatically disqualified if they voluntarily resign! If a claimant can prove good cause associated with the resignation, they may be found eligible for benefits. Good cause may include circumstances such as a substantial change to their employment relationship with the employer or reported work-related issues that were not resolved.

The claimant had a history of attendance problems. They shouldn’t be eligible for benefits!

Unfortunately, good business causes do not necessarily equate to misconduct. When reviewing attendance terminations, most states look at the final incident and whether they had good cause to miss work when determining disqualification.

Therefore, if a claimant had good cause for their last absence or tardy despite having a record of absences/tardies that were not for good cause, they would likely still be qualified for benefits.

We didn’t protest the claim. Why isn’t the claimant receiving benefits?

Neither you as the employer nor your unemployment claims manager determine whether a claimant is eligible for benefits. The state workforce agency makes this determination. Therefore, even if you do not protest an unemployment claim and do not provide disqualifying information, the claimant may be disqualified due to any one of the above circumstances.

About Us

For more than 40 years, 501(c) Services has been a leader in offering solutions for unemployment costs, claims management, and HR support to nonprofit organizations. Two of our most popular programs are the 501(c) Agencies Trust and 501(c) HR Services. We understand the importance of compliance and accuracy and are committed to providing our clients with customized plans that fit their needs.

Contact us today to see if your organization could benefit from our services.

Are you already working with us and need assistance with an HR or unemployment issue? Contact us here.

The information contained in this article is not a substitute for legal advice or counsel and has been pulled from multiple sources. Some information was provided by our friend, Darby Gibson, Client Marketing & Insights Specialist, at Thomas & Company.

(Images by Diloka107 and PVProductions)

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