Many people apply for unemployment benefits in the hopes of finding financial relief during uncertain times. Unfortunately, many applications are denied for reasons cited in the unemployment code. This article explains the most commonly cited sections for denying unemployment benefits.
§ 402(a)
This section states that an employee shall be ineligible for compensation for any week “(a) In which his unemployment is due to failure, without good cause, either to apply for suitable work at such a time and in such manner as the department may proscribe, or to accept suitable work when offered to him by the department office or by an employer, irrespective of whether or not such work is in employment.”
The section goes on to state that an employee shall not be disqualified of benefits when “work is offered by his employer and he is not required to accept the offer pursuant to the terms of the labor-management contract or agreement, or pursuant to an established employer plan, program or policy.”
Section 402 (a) denies benefits to an employee who fails to apply for suitable work or accept suitable work, absent an employer contract or policy. Such a restriction leaves many people wondering: what is suitable work? Suitable work is any work the employee is capable of performing. For instance, suitable work for an unemployed teacher might be a tutoring position, however, a plumbing position likely would not be suitable work. Suitable work means a job that offers wages comparable to an employee’s most recent employment and work duties that correspond to his/her education level and previous work experience. Thus, an employee may limit his/her job applications to jobs that offer employment and wages similar to what he/she had before he/she became unemployed, and are within a 45-minute commute.
§ 402(b)
Section 402 (b) provides that an employee shall be ineligible for compensation for any week “(b) in which his employment is due to voluntarily leaving work without cause of a necessitous and compelling nature.”
But what is a “necessitous and compelling” reason to voluntarily quit work? Basically, an employee who voluntarily quits work has the burden of proof in establishing good cause for quitting; and, that such cause was real and substantial, leaving the claimant no other alternative. The burden is on the claimant to show that, prior to quitting continuing employment, he/she made every reasonable effort to maintain the employer-employee relationship, such as by discussing or notifying the employer of an issue. Examples of “necessitous and compelling” reasons include: health, transportation problems, childcare, following a spouse, personal circumstances leaving no alternative, attending school, unsuitable work, and the job not being the same as anticipated.
§402(e)
Section 402(e) provides that an employee shall be ineligible for compensation for any week “(e) In which his unemployment is due to his discharge or temporary suspension from work for willful misconduct connected with his work.”
But what is considered “willful misconduct”? “Willful misconduct" is considered an act of wanton or willful disregard of the employer's interests, the deliberate violation of rules, the disregard of standards of behavior that an employer can rightfully expect from an employee, or negligence that manifests culpability, wrongful intent, evil design, or intentional and substantial disregard of the employer's interests or of the employee's duties and obligations. Examples of willful misconduct include, but are not limited to: absenteeism/tardiness, deliberate violation of an employer’s rule, disregard of standards of behavior which an employer can rightfully expect from the employee, damage to equipment or property, unsatisfactory work performance (provided that the claimant is not working to the best of his/her ability), and failure to submit to and/or pass a drug or alcohol test.
§402(h)
Section 402(h) provides that an employee shall be ineligible for compensation for any week “(h) in which he/she is engaged in self-employment…except when such activity is not engaged in as the primary source of livelihood.”
Essentially, section 402(h) prohibits unemployment benefits to any self employed individual unless the self-employment was not the primary source of income i.e. a “sideline activity.” If a claimant is starting a new business, the claimant is self-employed with the first positive step toward starting the business, such as advertising for the business or renting an office/equipment.
A four-pronged test exists to determine the eligibility for an individual engaged in a sideline business. An individual may still receive benefits despite the sideline business if all four of the following conditions are met:
1. Concurrency - the self-employment activities must have been conducted while engaged in employment.
2. Primary source of income - the earnings from employment must exceed the net profit from the self-employment activities.
3. There cannot be a substantial increase in involvement in self-employment.
4. The claimant must be able and available for FULL TIME suitable work.
The burden to prove all four conditions rests with the claimant. The scope of “self-employment” raises tricky issues where an individual is performing part-time work while trying to get a regular full-time job. Courts have had differing opinions on how to handle such a complexity and it is best to confront the issue with experienced counsel like an RMN attorney.
The above-mentioned examples are not the only examples of each relevant section; others exist. Contact RMN for a consultation if you have any questions or concerns regarding your UC benefit eligibility. Contact an RMN attorney today at lawyer@RMN-law.com or 412-626-5626.
