Job demotion and UI

[ajinaz]

What is the name of your state (only U.S. law)? Arizona

My wife's employer has changed their structure and her position is being eliminated. They have offered her a lower position at a salary that we can't live on. If she declines the new job offer, will she still be eligible for unemployment?

Thanks!

 

[cbg]

And do you think that unemployment, which pays only a fraction of your former wages, will pay her more than the reduced job?

 

[Betty]

Generally you don't receive UI when you quit/decline work offered. The UI folks prefer that you have some income as opposed to no income. Can she work at this new position while looking for employment with a higher income?

However, the state always has the final decision whether UI is awarded or not.

 

[commentator]

Very important. If she is going to not take the new job, she needs to refuse the job offer without working on it a minute! This will greatly increase her chances of being approved for unemployment insurance, as they would look at it as she voluntarily quit the job for a good job related reason, that they eliminated her position and offered her something that paid less. This is generally going to be looked at as a good job related reason to quit.

It should, of course, be a significantly less good salary. And you should realize, as cbg pointed out, that unemployment insurance at its very best probably does not pay as much as working, even at a reduced pay rate. You have to quickly, before the changed position is to begin, make a decision.

Is it better to work at something that pays less and be looking for another job that pays more while working, or to quit all together, have a fairly good chance of being approved for unemployment benefits, and with this reduced (or possibly not there at all, there's no way to guarantee she'll be approved) amount of money coming in and lots of free time, she'd be looking for another job too.

Unemployment insurance in the best of cases is also temporary, regular unemployment is only good for six months or less, and there are at this time some extensions funded by the government, but these could go away at any time with no guarantees.

But if she does accept the new position, works at it even for a short time (ten minutes, even!) and then quits, there is virtually no chance she will be approved for unemployment insurance, because she has accepted the job, with its reduced pay and conditions, and then has voluntarily quit it by her own choice.

In all my years I have never understood people who quit a job with no prospect of something new to go to because "I couldn't live on what I was making." I always want to ask them what they'll be living on now.

 

[cbg]

Just to give you some idea what I'm talking about:

To start out with, as of the most recent chart I have been able to locate, which is for 2009, Arizona's MAXIMUM benefit was $240 per week. Only one state in the US, according to that chart, paid a lower maximum. Not all or even most claimants will receive the maximum.

I do not know the formula for your state. In my state, which is THE most generous state in the US according to the chart referenced above, if her income had not changed at all for the 16 months prior to the job demotion, her income would have to be reduced by 50% before her unemployment benefit would EQUAL, let alone exceed, her reduced pay. If at any time in the 16 months previous to the demotion she had received an increase, her income would have to be reduced by MORE than 50% in order for her UI benefit to equal the reduced pay. Her income would have to be reduced by SIGNIFICANTLY more than 50% before she would receive more on unemployment than she would by working at the lesser position. Again, in my state. But whatever the formula is in your state, the MAXIMUM benefit is $240 per week.

 

[Beth3]

What is the name of your state (only U.S. law)? Arizona

My wife's employer has changed their structure and her position is being eliminated. They have offered her a lower position at a salary that we can't live on. If she declines the new job offer, will she still be eligible for unemployment?

Thanks!

Why would no job be better than the new job? Your wife almost certainly would make more money at the reduced salary than she would on unemployment benefits (which she is not likely to receive.) Plus any benefits your wife receives (health insurance? disability and life insurance? paid vacation? paid sick time?) she will lose if she quits.

Your wife should take the new job and immediately start looking for a new position that pays more.

 

[commentator]

Well, one of the arguments I have always heard for not accepting a lower paying job is that it costs money to go to work, as in gas money for the drive there and possibly child care. Those expenses I can see. But then people who argue this one always say, "Well, then you have to buy your clothes for work," (which absolutely gives me a headache!) and "You have to eat out," which I greatly disagree with. I also do not see the thing of "You have to have time to job search." When one is in survival mode, one does not buy clothes to wear to work, they wears what they already have on hand, nor does one eat out a lot while working (one packs a cooler) and I maintain that there has never been a job hunt in the universe conducted which takes all day every day.

But the thing is, sometimes in an effort to get rid of a person without having to pay them unemployment benefits, a company will change a worker's job description greatly (secretary to janitor, manager to cashier) and/or cut their pay and/or hours and/or benefits. If the job change appears to be somewhat unreasonable, particularly if it is directed at only one person, unemployment benefits are usually granted when the person quits, provided the person has not accepted the conditions of the new job by working at it.

But in a situation where the whole company is restructuring and many positions are being eliminated, it would appear that the company is trying to retain workers by offering them new positions instead of laying them off, and the OP should strongly consider this. There may be a lay off to full unemployment later down the road if the company cannot stay in business anyway. Or their fortunes may improve and they will be able to reward loyalty by giving back some of the lost salary. There's truly a lot to think about.

The thing to remember is that there's no salary negotiation with unemployment benefits, you get so much for so long,regardless of how many thousands you're making a year now, and then it's over, kaboom, whether you've found a job or really really need it or not. And it is not designed to be anywhere near as good as working at a job, just a desperation stop gap between employment and being penniless.

 

[Free_Advice]

What is the name of your state (only U.S. law)? Arizona

My wife's employer has changed their structure and her position is being eliminated. They have offered her a lower position at a salary that we can't live on. If she declines the new job offer, will she still be eligible for unemployment?

Thanks!

I would recommend that she look for a new job while still working at her current employer .. you know that many people have been out of work for 2 yrs?

 

[cbg]

...or longer.