EDD eligibility when company closes & asks you to quit voluntarily

DO NOT AGREE TO QUIT! This is a common tactic some employers use to try to avoid unemployment claims. If you voluntarily quit, EDD might initially deny your claim. If the company is definitely closing, you should wait for them to lay you off officially. That way, you're clearly eligible for unemployment because the separation was due to 'lack of work' which is a qualifying reason.\n\nIf they pressure you, simply say you'd prefer to return to work when you're able and complete your employment properly until the closure date. Document any conversations where they suggest you quit voluntarily - save texts, emails, write down phone call details, etc.

Omg thank you! I had a feeling this wasn't right. They're calling me again tomorrow so I'll definitely tell them I want to stay employed until the official closure. Should I mention that I know this affects unemployment eligibility or just keep it vague?

Your instincts are correct - this absolutely sounds like they're trying to avoid paying their portion of unemployment insurance. Companies that go out of business often try to minimize the number of UI claims filed because it can affect their rates (even though they're closing). \n\nHere's what you need to know: \n1. If you quit voluntarily, you'd have to prove good cause for quitting to get UI\n2. If you're laid off due to business closure, you automatically qualify\n3. Even if you did quit now, you could still potentially get UI by explaining the business was closing anyway, but it creates unnecessary complications\n\nWait for the official layoff notice. Don't let them pressure you into quitting.

This happened to my brother last year when his manufacturing plant shut down. Manager tried to get a bunch of ppl to quit early to \

wen my company closed they did the same thing tried to get us to quit i said no then they tried to say i was a no show after i told them i was sick lol these companies are shady AF

Same!!!! My retail job closed down last summer and they kept

I experienced this exact situation in 2023! My company announced they were shutting down and then started individually approaching employees asking if we wanted to \

Thank you! That's really helpful to know. I'll make sure to get proper documentation when they officially close. How long did it take for your UI claim to get approved after your company closed?

Hate to be the cynical one here but they 100% trying to trick you into quitting so they don't hav to pay for unemployment! Seen this SO many times. Classic move by companies going under...they'll do anything to save a buck even when they're already closing!!

Yeah I'm starting to realize that's exactly what they're doing. Pretty disappointing after 3 years of working there, but I guess that's business. I'm definitely not going to quit now.

If you're having trouble reaching EDD to ask about your specific situation or later when filing your claim, try using Claimyr (claimyr.com). It's a service that helps you connect with EDD representatives by phone instead of trying for hours and getting those frustrating \

does this acutally work? i spent 2 DAYS trying to get thru to edd last time and gave up

Yes, it definitely works. The service basically navigates EDD's phone system for you and calls you back when they've reached a live person. Much better than spending hours redialing yourself.

wait but what if ur on medical leave when the company closes? does that change anything with EDD? Just curious bc OP mentioned being out for sons surgery

Good question. Being on leave when the company closes doesn't change your UI eligibility. As long as you're able and available to work at the time you file your claim, you can receive benefits. The important thing is that the separation was due to lack of work (business closure), not voluntary. Medical leave for a family member isn't the same as disability leave - once the leave ends, you'd still be considered able to work.

That's really helpful information. I should be able to return to work next week, which is before their official closure date anyway. So it sounds like I just need to make sure I don't agree to quit and wait for the official layoff notice.

I'm so sorry you're dealing with this while also taking care of your son after surgery! Companies can be so heartless sometimes. Hope your son is recovering well!

Thank you! He's doing much better now. The timing of all this is just extra stress I didn't need, but at least now I know not to fall for their trick to get me to quit.

Just to clarify one more important point: When you do apply for unemployment after the layoff, make sure to be 100% truthful about being asked to quit. If they ask if you were offered the opportunity to resign, be honest and explain you declined because you wanted to continue working until the business closed. Being transparent with EDD is always the best approach - they'll view the company's actions as trying to avoid their UI obligations, which won't reflect poorly on you at all.

I definitely will be completely honest about everything. I'll make detailed notes after tomorrow's call too so I have the information fresh if I need it for my claim. Thanks again everyone for the advice! I feel much more prepared now.

I'm dealing with something similar right now! My company announced they're closing in 6 weeks and HR has been "casually" asking people in individual meetings if they want to "make things easier" by resigning early. It's so manipulative - they know most people don't understand how this affects unemployment eligibility. I'm glad you posted this because it confirms what I suspected. Definitely waiting for the official layoff notice. Companies really show their true colors when they're going under, don't they?

This is exactly why we need more awareness about these predatory tactics! Companies going out of business often try every trick in the book to minimize their final costs, even if it means screwing over loyal employees. What you're describing is textbook unemployment avoidance - they know that voluntary resignations create hurdles for UI eligibility while layoffs due to business closure are automatic approvals. The fact that they're targeting you while you're dealing with a family medical emergency makes it even more disgusting. Stand your ground, document everything, and remember that you've earned those unemployment benefits through your payroll contributions over 3 years. Don't let them guilt trip you into giving up what's rightfully yours. Good luck with the call tomorrow - you've got this!