Does employer pay for unemployment benefits in NY - confused about who funds this
I'm getting ready to file for unemployment and my coworker said something about employers having to pay for it? I'm really confused about how this works. Does my employer directly pay my unemployment benefits or does it come from somewhere else? I don't want to file if it's going to hurt my employer financially since they're a small business and I was laid off due to budget cuts, not performance issues. Can someone explain how the NYS Department of Labor funding actually works?
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Ayla Kumar
Your employer doesn't pay your benefits directly. They pay unemployment insurance taxes to the state throughout the year based on their payroll. The NYS Department of Labor uses this pool of money to fund unemployment benefits for all eligible claimants. Your specific claim doesn't come directly out of your employer's pocket - it's paid from the state unemployment insurance fund.
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Clay blendedgen
•Oh that makes me feel better! So filing won't directly cost them money right now?
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Lorenzo McCormick
The way it works is employers pay quarterly unemployment insurance premiums to NYS Department of Labor. The rate they pay can go up if they have a lot of claims against them over time, but your individual claim won't immediately hit their bank account. It's more like insurance - they pay into the system and the system pays out benefits.
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Carmella Popescu
•exactly this. my employer had to lay off 15 people last year and their UI rate did go up the following year but it wasn't like they had to write a check for each of our claims
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Kai Santiago
I was worried about the same thing when I got laid off! But I learned that employers are required by law to carry unemployment insurance. It's not optional and they budget for these costs. Filing for benefits is your legal right and you earned those benefits through your work history.
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Clay blendedgen
•Thank you, that's really reassuring. I was feeling guilty about even considering filing.
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Lim Wong
I had trouble reaching NYS Department of Labor to ask similar questions about employer obligations. Ended up using this service called Claimyr (claimyr.com) that helped me get through to an actual agent who explained the whole funding system. They have a video demo at https://youtu.be/qyftW-mnTNI that shows how it works. Really helped clear up my confusion about who pays what.
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Lorenzo McCormick
•That's interesting, I always just waited on hold forever when I needed to talk to someone at NYS Department of Labor.
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Dananyl Lear
The system is designed so that employees who lose their jobs through no fault of their own can get temporary income support. Employers know this cost is part of doing business. Don't feel guilty about using a safety net that exists specifically for situations like yours!
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