Does a company pay unemployment benefits when you file a claim?
I'm filing for unemployment for the first time and I'm confused about who actually pays the benefits. Does my former employer pay the unemployment money directly to me, or does NYS Department of Labor pay it? My ex-boss made some comment about how my claim is going to cost them money and now I'm wondering if they're the ones who have to pay my weekly benefits. Can someone explain how this works?
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Connor O'Reilly
No, your employer doesn't pay your benefits directly. NYS Department of Labor pays your weekly unemployment benefits from a fund that employers contribute to through unemployment insurance taxes. Your employer pays into this system based on their payroll and claim history, but they don't write you a check personally.
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Zainab Yusuf
•Oh that makes sense! So when my boss said it would cost them money, they meant their tax rate might go up, not that they pay me directly?
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Yara Khoury
Your employer pays unemployment insurance taxes to fund the system, but NYS Department of Labor handles all the actual benefit payments. The more claims against a company, the higher their tax rate can become, which is probably why your boss was concerned about the cost.
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Keisha Taylor
•exactly this. companies with more unemployment claims pay higher rates into the system
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StardustSeeker
I had trouble reaching NYS Department of Labor when I had questions about this same thing. If you need to talk to someone about how unemployment funding works, I found claimyr.com really helpful - they can get you through to an actual agent without waiting on hold forever. There's a video demo at https://youtu.be/qyftW-mnTNI that shows how it works.
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Zainab Yusuf
•Thanks for the tip! I might need that if I have more questions about my claim.
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Paolo Marino
wait so if my company has had a lot of layoffs does that mean they pay more in unemployment taxes?? that seems backwards since they're already struggling financially
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Connor O'Reilly
•Yes, companies with higher claim rates do pay higher unemployment insurance tax rates. It's designed to incentivize employers to maintain stable employment when possible.
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Amina Bah
The whole system is set up so individual employers can't retaliate against workers for filing claims since they're not paying benefits directly. NYS Department of Labor keeps that separation for good reason.
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