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Ava Thompson

Can you get Washington ESD unemployment with severance pay?

I just got laid off from my tech job after 6 years and they're giving me 12 weeks of severance pay. I'm wondering if I can still file for unemployment benefits with Washington ESD while receiving severance? The severance is structured as regular payroll for the next 3 months. I've heard different things about whether this affects your UI eligibility. Has anyone been in this situation before?

Yes, you can typically file for unemployment even with severance pay, but it depends on how the severance is structured. If it's paid as regular wages (which yours sounds like), Washington ESD will usually treat those weeks as if you're still employed for those specific weeks. You'd need to report the severance when you file your weekly claims.

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So I should wait until the severance period ends to file my initial claim? Or file now and just report the severance on my weekly claims?

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You can file your initial claim right away to get the process started. The waiting period and benefit year start immediately. Just report the severance on your weekly claims during those weeks - you won't get benefits for those specific weeks but your claim stays active.

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I had this exact situation last year. Filed my claim immediately after being laid off even though I was getting 8 weeks severance. Washington ESD approved my claim but I didn't receive any benefit payments during the severance weeks. Once the severance ended, my benefits kicked in normally. Definitely file soon though - there's sometimes adjudication delays.

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That's really helpful! Did you have any issues with Washington ESD understanding the severance situation, or was it pretty straightforward?

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It was straightforward once I got through to someone to explain it. The hard part was actually reaching Washington ESD by phone to clarify how to report it properly. I ended up using Claimyr.com to get through - they have this system that calls for you and connects you when an agent picks up. There's a demo video at https://youtu.be/7DieNd3C7zQ that shows how it works.

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wait so if you get severance you can still get unemployment? i thought you had to choose one or the other

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No, severance doesn't disqualify you from unemployment. It just affects the timing of when you receive benefits. Think of severance as delayed wages from your previous job, not as current employment.

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ok that makes sense. my company is doing layoffs next month and i was worried about losing out on benefits

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The key thing is HOW the severance is paid. If it's a lump sum, Washington ESD spreads it out over the weeks it's intended to cover. If it's paid weekly like regular wages (like yours), then you report it week by week. Either way, you're still eligible for UI once the severance period is over. Make sure you understand your severance agreement terms before filing.

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Mine is definitely weekly payments through regular payroll. Should I mention in my initial application that I'm receiving severance, or just wait until the weekly claims?

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Mention it in your initial application if there's a spot for it, but definitely report it on each weekly claim where you receive it. Be completely transparent - Washington ESD can verify employment records and you don't want any overpayment issues later.

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I'm going through this right now actually. Filed my Washington ESD claim 2 weeks ago while getting severance. My claim got approved but I'm in 'unpaid' status during the severance weeks. The confusing part is that I still have to file my weekly claims and do the job search requirements even though I'm not getting paid benefits yet.

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Oh interesting, so you still have to do job searches during the severance period? I wasn't sure about that part.

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Yeah, you have to stay in compliance with all the requirements to keep your claim active. It's annoying but I guess it makes sense since the benefit year has started.

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That's correct - the job search requirement stays in effect. I think it's 3 job search activities per week in Washington. Keep good records because they do audits.

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Just be careful about the job search requirement interaction with severance. Some severance agreements have non-compete clauses or restrictions on when you can start a new job. Make sure your job search activities don't conflict with your severance terms.

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Good point! I do have a 90-day non-compete. I should probably check with a lawyer about how that affects the job search requirement.

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Non-competes usually don't prevent you from SEARCHING for jobs, just from accepting certain positions. But definitely worth clarifying with your severance agreement.

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Been there done that. Got 16 weeks severance when my startup folded. Filed for unemployment immediately and just reported the severance each week. No benefits during severance period but everything kicked in normally afterward. The only tricky part was getting through to Washington ESD to make sure I was reporting everything correctly.

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How long did it take you to get through to someone at Washington ESD? I keep seeing people complain about the phone system.

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Oh it was brutal - spent hours calling. Finally someone told me about Claimyr which basically calls for you and gets you connected to an agent. Saved me so much time and frustration. Worth checking out if you need to talk to someone at Washington ESD.

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One thing to watch out for - make sure your employer codes the reason for separation correctly. Sometimes with layoffs involving severance, the separation reason gets messed up in their system which can delay your claim approval. I had to appeal because my company initially coded it wrong.

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How would I know if they coded it wrong? And what should it say for a layoff with severance?

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It should show as 'lack of work' or 'layoff' - definitely not 'quit' or 'terminated for cause'. You can see this in your online account once your claim is processed. If it's wrong, you'll need to appeal and provide documentation.

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Tech layoffs are so common right now. The good news is Washington ESD is used to processing these types of claims with severance. Just be honest about everything and keep all your severance documentation. Also start your job search activities right away even if you're not getting paid benefits yet - it takes time to find a good position anyway.

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True, the job market is pretty competitive right now. Better to start early. Thanks for all the advice everyone - this has been really helpful.

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Good luck! The severance + unemployment combo actually gives you a little breathing room to find something good instead of taking the first offer.

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Double check if your severance is subject to payroll taxes. If they're withholding taxes like regular wages, then Washington ESD will definitely treat it as wages for those weeks. If it's a lump sum with different tax treatment, the rules might be slightly different.

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Yeah they're withholding all the normal taxes - FICA, state, federal. So sounds like it's treated as regular wages.

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Exactly. That makes it straightforward for Washington ESD purposes. Just report it week by week as you receive it.

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I'm in HR and deal with this all the time. The key is timing your Washington ESD application. File as soon as possible after your last day of work, even if severance continues. This starts your benefit year and gets you in the system. The severance just delays when you receive payments, but your claim stays active.

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That makes sense. So there's no downside to filing early, just delayed benefits during the severance period?

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Correct. Filing early also means if there are any issues with your claim that need adjudication, that process can start while you're still getting severance pay.

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This is really good advice. Adjudication can take weeks sometimes, so starting early helps avoid gaps in income.

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Question about this - if you're getting severance and file for unemployment, do you still get the full benefit amount once severance ends, or is it reduced somehow?

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Your benefit amount is calculated based on your wages from before you were laid off, not affected by the severance. So you get the full calculated benefit amount once the severance period ends.

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Thanks! I was worried the severance might somehow reduce the benefit calculation.

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Pro tip: if you're having trouble reaching Washington ESD to clarify anything about severance reporting, try calling right when they open or during lunch hours. Or there are services like Claimyr that can help you get through faster. I used them when I had questions about my severance situation.

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I keep seeing Claimyr mentioned. Is it worth the cost?

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For me it was definitely worth it because I needed answers quickly and couldn't spend all day calling. It's way less stressful than the regular phone system.

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Make sure you understand your severance agreement completely. Some agreements have conditions like you forfeit severance if you find new employment before it ends. This could interact weirdly with the job search requirements for unemployment. Probably worth having an employment lawyer review it.

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Good point. I should read through the fine print more carefully. I know there's something about returning equipment and non-disclosure but I should check for employment restrictions.

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Yeah definitely read it carefully. Some companies also require you to be available for consulting during the severance period, which could affect your availability for new work.

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Been through this twice in my career. Both times I filed for unemployment immediately and just reported severance on weekly claims. The process was smooth both times. Washington ESD is pretty experienced with this situation since it's common in corporate layoffs.

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That's reassuring to hear. Did you have any issues with the transition from severance to receiving benefits?

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No issues at all. The benefits started automatically the week after my severance ended. Just make sure you keep filing your weekly claims during the severance period even though you're not getting paid.

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One more thing - keep records of everything. Save copies of your severance agreement, pay stubs showing the severance payments, and any communication with Washington ESD. If there's ever an audit or overpayment investigation, you'll be glad you have documentation.

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Great advice. I'll set up a folder for all the unemployment related documents. Thanks everyone for all the help!

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You're welcome! Feel free to post again if you run into any issues during the process.

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