The Pennsylvania Unemployment Compensation Law includes provisions for reducing your unemployment benefits under certain circumstances. Understanding what these circumstances are does not always allow you to do anything about it, but it will help you prepare for any reduction in your income. This is especially important if you are a long-term unemployed worker and have extra financial responsibilities such as a mortgage. This series of article will discuss three of the main reasons the PA Labor and Industry Department could (legally) reduce your weekly benefits.

Low Balance in the Unemployment Compensation Trust

The Pennsylvania UC Law section 404e 4(ii) allows the Labor and Industry Department to reduce benefits when the state Unemployment Compensation Trust Fund is low. Since January 2, 2010, the Labor and Industry department have reduced the benefits of unemployed workers by 2.3 percent due to the increase in unemployed workers and the reduction in contributions toward the fund. This reduction is foreseen to continue during the rest of 2011.

There are certain points you may want to consider if you are affected by this reduction.

First, the benefit reduction amount will be rounded up to the next dollar. This is not going to break the bank, but its nice to know where your money is going, even if it’s only pennies.

Second, this reduction of 2.3 percent applies to your basic unemployment benefits and your dependents allowance.

Third, the reduction of benefits is applied to the final payable amount, once earnings, vacation, pensions and holidays have been deducted. However, it is deducted before any pending federal tax, child support or overpayment offsets are deducted.

If you would like more information on the law that permits this reduction click here.

Child Support Reduction

Another possible source of unemployment benefit reduction is child support. If you are responsible for paying child support the DRS, or Domestic Relations Section will inform the PA Labor and Industry department and request the reduction of child support from your UC benefits.

The process is as follows. The DRS will notify the PA UC agency of your financial responsibilities and provide an amount or percentage that must be deducted from your payments. For instance, the DRS may request a $75 or 50 percent deduction of your benefits. This means $75 or 50 percent of your benefits, whichever is less, will be taken away from your wages and sent directly to the DRS handling your children’s case.

If you opted to deduct the Federal Tax from your benefits automatically, the percentage amount of your deduction will be taken from your gross amount, before the tax has been deducted.

Our next article will discus the third main reason why the PA Labor and Industry department applies reductions from unemployment benefits.

Losing a job is often a traumatic and unexpected experience. This often causes us to make less than ideal decisions, which can further affect our financial situation. For instance, what happens if you do not apply for unemployment benefits straight after losing your job. This often occurs with workers who have never or rarely been unemployed. You may go through a period of denial, which can last several weeks, where you hope to either recover your old job or bounce straight back into a new one.

What happens if you took several weeks to file your initial unemployment benefits claim? Can you backtrack your application and get paid for the weeks you missed?

Sadly, the answer to this question is not as straightforward as we would like. As a general rule you cannot backtrack your unemployment application. However, in some “very limited number of circumstances” the Labor and Industry Department of Pennsylvania may consider paying your for your missed benefits. Contact the PA Labor and Industry Department or visit your local CareerLink office for more information.

Missing a few weeks benefits is not the only reason you should be quick to apply for UC in Pennsylvania. If you delay your application for too long this could affect your eligibility for unemployment compensation altogether. Let’s explain.

In Pennsylvania your unemployment compensation eligibility is determined by the income you earned during your base period, the last four quarters from filing for UC. If you wait to long to apply while you are no longer reporting an income, your chances of receiving unemployment benefits could suffer.

What is Pennsylvania’s PREP program and why should you set aside the time to go?

The federal government has determined all states institute a worker profile and re-employment system. These systems are designed to screen for workers who are most likely to exhaust their unemployment compensation benefits and may need special assistance to find work. If you are selected by this program, you may receive special assistance finding work. Also, if your are selected to participate in the program without a good reason you could be lose your unemployment benefits. If your personal circumstances don’t allow you to attend the Profile Re-Employment Program (PREP) call your local Pennsylvania (PA) CareerLink office and explain your situation.

What help will the PREP program provide?

Participants in PA’s PREP are given personalized assessment and guidance on career planning and occupational needs. It also provides better job match and referral services. You will also qualify for job match, referral services, labor market information and resume preparation help. These services can increase your chances of finding employment and provide you with valuable education and training opportunities.

Several of our readers have sent us some new questions we have yet to cover on this website. These are real-life situations which deal with questions and problems you may also be struggling with. If you don’t find the answer to your query, tell us about your problem in the comment section below.

My job will be eliminated in 2011 and I will apply for PA unemployment.  I currently receive a Social Security check.  Will my social security payments disqualify me for unemployment compensation?

Not necessarily. However, the details depend on your personal circumstances. For instance, if you are receiving social security because you are unable to work, then you would not qualify for unemployment benefits. One of the requirements to receive unemployment benefits is you are fit and able to work. Yet, if you are receiving social security benefits lawfully to complement your income while you are working, there should  be no conflict with your PA UC. Nevertheless, because the answer to this question depends on your particular situation, we recommend you call the Pennsylvania Department of Labor and Industry at 717-787-5279 for more information.

Social security and unemployment compensation are separate issues. If your income during you base period (the year before your first claim for Pennsylvania unemployment compensation) is enough to qualify you for benefits and you were laid off due to no fault of your own, you should have no problem with your claim

My employer has informed me that due to a lack of work she will have to carry out intermittent layoffs, where I will be employed and laid off sporadically. Can I still apply for UC benefits?

Yes. File for unemployment benefits the moment you are first laid off. File your biweekly benefits normally and stop filing when you are employed again. If you are laid off again re-open your claim by using the new claim application on the Pennsylvania Labor and Industry website. You can also download a paper form here or phone 1-888-313-7284. Once you reopen a claim you do not have a waiting week and can start filing biweekly claims immediately.

Your claim application will be assessed as any other, regardless of how long you expect to be unemployed. It is important the reason you are laid off is not due to any fault of your own. Also, if your employer reduces your hours because of lack of work, you may qualify for partial benefits. More on that in our next article.

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