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BusinessColumnistsCarrie Mason-Draffen

If timing works, you can receive severance and unemployment

Timing is everything when trying to collect severance

Timing is everything when trying to collect severance and unemployment benefits. Photo Credit: Getty Images/iStockphoto / AndreyPopov

DEAR CARRIE: Is it true that if a laid-off professional waits 31 days to receive severance pay from an ex-employer he or she can receive unemployment insurance benefits concurrently? And is it also true that when severance is not paid out in one lump sum, but rather in weekly paychecks, a laid-off worker has to wait for the payments to end before collecting unemployment benefits? I am a career counselor and this question often comes up, and I want to disseminate correct information. — Benefit Eligibility

DEAR BENEFIT: You are referring to unemployment-benefits changes that took effect in New York in 2014, which, in some cases, prevent laid-off workers from receiving unemployment benefits and severance pay at the same time.

But those rules have one big exception, to which you alluded. Here is what the state Labor Department’s website says:

“If you receive your first dismissal/severance payment more than 30 days after the last day you worked, you will be able to receive unemployment insurance benefits if you meet the other eligibility requirements.”

That is why some laid off workers, if possible, opt to have their severance payments begin 31 days after they are laid off so they can receive severance and unemployment benefits at the same time.

If the severance payments begin right away or within 30 days of a layoff, then other rules apply. Again from the website:

“You may be eligible to collect benefits if: the weekly amount of dismissal/severance pay is the same as or less than the maximum weekly unemployment insurance benefit rate . . . ”

But if the weekly severance amount is greater, those laid-off workers wouldn’t be able to collect jobless benefits until their severance payments end.

And it doesn’t matter if the severance payments are made in a lump sum. The Labor Department will calculate their weekly value to see how they compare with the current $430 maximum weekly unemployment benefit.

Whether severance comes into question or not, the Labor Department always says that workers should apply for benefits immediately after a layoff to prevent any unnecessary delays.

DEAR CARRIE: I am an exempt employee working as a field representative for a large sales company. I am based in the office and work five days a week from 8 a.m. to 4 p.m., with an hour for lunch. I work 35 hours a week and am paid for 35 hours. But we are now being asked to attend industry marketing events, which are usually held on Saturdays and Sundays. As exempt employees we’ve been told we will receive no compensation for the extra time. In addition, we’ve been told we won’t receive any comp days. In the past we received compensatory time when we worked extra days. Do state or federal labor laws allow our employer to require us to work six or seven days in a week? — Too Many Hours.

DEAR TOO MANY: Generally labor laws don’t limit adult employees’ workweeks, except in a few industries.

And as your situation indicates, exempt workers don’t have to be paid for any extra hours. Even the comp time your company offered before isn’t mandated for exempt workers, unless a union contract calls for it.

Hourly workers, on the other hand, have to be paid for all the time they work and must earn overtime pay when they work more than 40 hours a week. But exempt workers are exempt from overtime.

That said, everybody needs a day off during the week. Otherwise the short-term gains of added face time at industry events will be eroded by a long-term loss of productivity and morale.

Go to bit.ly/LIuibene for more on unemployment benefits and severance pay.

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