Can you get unemployment if you get severance from NYS Department of Labor?
My company is laying off a bunch of people next month and they're offering severance packages - 8 weeks pay for my position. I've never dealt with unemployment before but I'm wondering if getting severance affects whether I can file for NYS Department of Labor benefits? Does the severance payment disqualify me completely or just delay when I can start collecting? I really need to know because I have to decide whether to take the severance or not.
16 comments
Join the conversation
Kennedy Morrison
You can still file for unemployment benefits even if you receive severance pay. However, NYS Department of Labor treats severance as deductible income during the period it covers. So if you get 8 weeks of severance, you typically can't collect UI benefits for those 8 weeks. The good news is you can file your claim right away - just report the severance on your weekly certification and NYS Department of Labor will calculate when your benefit payments can start.
0 coins
Lily Young
•That's helpful, thanks! So I should definitely take the severance then file immediately? Do I need to wait until my last day of work to file the claim?
0 coins
Wesley Hallow
had this same situation last year when my restaurant closed down permanently. they gave me 4 weeks severance and i was still able to get unemployment after that period ended. just make sure you report everything accurately on your weekly claims because nys department of labor will find out about the severance anyway through your employer
0 coins
Lily Young
•Good to know it worked out for you! Did you have any issues with the timing or paperwork?
0 coins
Wesley Hallow
•nope pretty straightforward once i understood how to report it. the hardest part was actually getting through to someone at nys department of labor to ask questions
0 coins
Justin Chang
The NYS Department of Labor system is so frustrating when you're trying to get answers about complex situations like this. I spent weeks trying to reach someone by phone last time I had questions about my claim. If you need to speak with an actual agent, I found this service called Claimyr (claimyr.com) that helps you get through to NYS Department of Labor representatives. They have a video demo at https://youtu.be/qyftW-mnTNI showing how it works. Saved me hours of being on hold and getting disconnected.
0 coins
Lily Young
•Interesting, I'll check that out if I run into problems. Hopefully the online system will have enough info for my situation.
0 coins
Grace Thomas
Take the severance for sure! Even if it delays your unemployment benefits, having guaranteed income for 8 weeks is better than relying on the unemployment system right away. Plus you'll have time to look for work without the stress of waiting for your first UI payment to come through.
0 coins
Hunter Brighton
Just to clarify the process - you can file your initial claim as soon as you're laid off, but when you do your weekly certifications, you'll need to report the gross amount of severance you received each week. NYS Department of Labor will then determine your benefit eligibility for that week based on their deductible income calculations. The severance won't affect your overall benefit entitlement, just the timing of when you start receiving payments.
0 coins
Aria Washington
I went through this exact situation 6 months ago when my tech company did layoffs. Definitely take the severance - it's basically free money that just shifts your unemployment timeline. I filed my claim the day after my last day of work and reported my severance weekly. NYS Department of Labor was actually pretty clear about the process once I got into the system. One tip: keep all your severance documentation because they may ask for it later to verify the amounts and dates. Also start your job search immediately during the severance period so you're already in the groove when your UI benefits kick in.
0 coins
Hannah Flores
•Thanks for sharing your experience! That's really reassuring to hear from someone who went through the exact same thing recently. The documentation tip is super helpful - I'll make sure to keep everything organized. Did you find that starting your job search during the severance period made a difference in how quickly you found new work? I'm wondering if I should treat those 8 weeks as a serious job hunting period rather than just a break.
0 coins
Mikayla Brown
One thing to keep in mind is that even though severance delays your unemployment benefits, you should still file your claim right away because there's a waiting period before benefits start anyway. I made the mistake of waiting to file until after my severance ended and it just delayed everything even more. Also, make sure you understand exactly how your severance is being paid out - is it a lump sum or spread over 8 weeks? The payment structure can affect how NYS Department of Labor calculates the deductible income period. Either way, definitely take the severance - it gives you a financial cushion and more time to find a good job rather than having to take the first thing that comes along.
0 coins
StarStrider
•That's a really good point about the payment structure! I hadn't thought about whether lump sum vs. weekly payments would make a difference in how NYS calculates things. My company mentioned it would be paid out over the 8 weeks rather than all at once, so sounds like that should make the reporting pretty straightforward. The waiting period reminder is also helpful - I definitely don't want to delay things even more by filing late. Thanks for the practical advice!
0 coins
Haley Stokes
I'm in a similar boat - my company just announced layoffs for next month and I'm trying to figure out the best approach. From reading everyone's responses, it sounds like taking the severance is definitely the way to go. I'm curious though - does anyone know if there are any tax implications I should be aware of when receiving both severance and unemployment benefits? I want to make sure I'm setting aside enough for taxes since this will probably put me in a weird income situation for the year. Also, has anyone had experience with how this affects health insurance coverage? My COBRA will kick in but I'm wondering if the severance payment timeline impacts when I might qualify for marketplace subsidies.
0 coins
Ingrid Larsson
•Great questions about the tax and health insurance aspects! For taxes, both severance and unemployment benefits are taxable income, so you're right to think about setting money aside. You can have taxes withheld from your UI benefits when you file your weekly certifications - I'd recommend doing that to avoid a big tax bill later. As for health insurance, the severance timing shouldn't directly affect marketplace subsidy eligibility, but your total annual income (including both severance and UI benefits) will be considered when they calculate any premium tax credits. You might want to consult with a tax professional since everyone's situation is different, but definitely keep good records of all payments and dates. The health insurance piece can get tricky with the timing between employer coverage ending, COBRA starting, and potential marketplace enrollment periods.
0 coins
Jamal Carter
I went through a similar layoff situation about a year ago and can confirm what others have said - definitely take the severance! The key thing to understand is that NYS Department of Labor considers severance as "deductible income" which means it reduces your weekly benefit amount dollar-for-dollar during the period it covers, but it doesn't disqualify you from unemployment entirely. So if your severance equals your normal weekly pay for 8 weeks, you'll likely get $0 in UI benefits for those 8 weeks, but then your full benefits will kick in after that. File your claim immediately after your last day of work though - don't wait for the severance period to end. This way you'll already be in the system and your benefit year will have started. Also, make sure you accurately report the severance amount each week when you do your certifications. The whole process was actually more straightforward than I expected once I understood how it worked.
0 coins