Terminated from full time job, self-employed part time

[PaulMass]

What is the name of your state (only U.S. law)? MA

I have started a part time business that I hope to grow to full time. My employer is aware of this, and is now making plans to replace me (I saw my job posted on a job board).

Will any part time income mean I cannot collect unemployment?

Will any part time income reduce my unemployment?

Does looking for business (marketing efforts) fill the requirement for seeking employment?

 

[OHRoadwarrior]

We cannot answer your question as the response is situation specific.

http://www.mass.gov/lwd/unemployment-insur/filing-a-claim/understanding-eligibility-requirements.html

 

[commentator]

If you are terminated or laid off from the job you have right now, that will be the first situation/variable/question what happens that will determine the answer to your question.

If you quit the job because you don't have the time to work for them anymore because you are too busy growing your new business, the answer is absolutely no, you will not be able to receive unemployment insurance. If you quit the job because they're threatening to fire you, or because they have told you they're going to fire you, or you saw your job posting on the board, if you quit the job for any reason at this point, you will very likely not be able to draw benefits. So the first variable is what they actually do concerning your employment there.

If you file for unemployment insurance after you are let go, however they state it, and they respond that you were not devoting your whole interest to their job and were not performing well because you were too involved in your part time business, that doesn't look good for your side, either.That could be misconduct, and if they had a valid misconduct reason to terminate you, that likely means no unemployment approval.

Remember, in order to qualify for unemployment insurance, you must be out of work through no fault of your own, and able and available for work (and that work must be equivalent, and to the full extent that your previous job was.) You may be required to make job searches and participate in job seeking activities as dictated by the system. If you are willing to do all that, and you would do the job searches in good faith and would accept other suitable work if it were offered to you, you may be able to be approved, and you may be able to stay eligible, even though you are working at developing your part time job, particularly if it's a new business, self employment of some type.

The income you make on the part time job is not going to be a factor. Nothing about unemployment eligibility is going to be about your income, unless you are working at a part time wage paying tax collecting job, (for example) you're laid off from your regular job, but work a part time cashier job at the box store to suppliment your regular work income. Then if you are making more than your weekly unemployment benefit would be in gross wages, you would be considered fully employed, and you would not be able to draw benefits. However, availability for other full time work is considered

It just all depends on the reason they let you go, if they do, and the nature of your part time job or business.

 

[PaulMass]

Thanks for the response.

I have no intention of quitting, or slacking off.

I saw someone interviewing today, so I looked online to see if my job was posted. I was pretty startled to find it.

My employer has pretty well defined progressive discipline. Unless I do something really stupid, it takes three warnings before they terminate me for cause. I've never gotten a warning, and I don't plan to.

Many years ago, I was on unemployment and found a one week gig working for someone on a contract basis. When I checked off the 'self employed' box on my claim for that week, they shut me off from unemployment.

What I would like to do is claim my self employment earnings the same way I would part time employment, and have that week's check reduced by the amount earned. (I think that's what they do with part time work). That would let me extend my weeks until my pool of funds is exhausted.

The reason I started this part time business is because my employer's days are numbered and there are no other jobs left in that industry. I've kept my eyes open but haven't seen an opening for many years.

Thanks again for the help.

 

[HomeGuru]

What is the name of your state (only U.S. law)? MA

I have started a part time business that I hope to grow to full time. My employer is aware of this, and is now making plans to replace me (I saw my job posted on a job board).

Will any part time income mean I cannot collect unemployment?

**A: not exactly, but part time income will decrease your benefits. If your part time income exceeds your allowable benefits, then you would not be entitled to compensation.

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Will any part time income reduce my unemployment?

**A: see above.

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Does looking for business (marketing efforts) fill the requirement for seeking employment?

**A: no, you can't count that. You must apply at other businesses and cannot count your own business as a potential employer.

 

[cbg]

I am in MA and I can tell you that no, looking for opportunity to grow your own business does NOT fulfill the requirement for seeking employment. There is a specific number of hours you can work at your own business (I forget exactly how many it is) and if you exceed that, it is considered that your own business is detracting from your job search and can cause your benefits to be denied.

 

[HomeGuru]

Yeah, it's the "if you already have a job then you don't need a job and therefore don't need UE checks from us"

signed,

MA State Unemployment Insurance Office.

 

[commentator]

As to what happened way back when you filed before, any week that you list yourself as " self-employed" on your weekly certification, without further information, they assumed you didn't want unemployment and were no longer eligible for it. They stopped sending the checks, stopped your claim. If you only worked one week, and the next week you no longer had the job, then what you should have done was re-opened your claim, and then you would have been able to continue to receive checks until you either found another permanent job or ran out of benefits. Working one week is not a complete claim killer, you do not get to keep getting a check if you worked that week and made wages larger than your regular unemployment weekly benefit, but if it did not last you could certainly re-apply and start the benefits back up under most circumstances.

You are only supposed to report part time work that you actually did for wages, working for a covered employer. But if for accuracy's sake, you did report the wages you paid yourself in the part time business, a few hundred a week, you certainly need to be able to have really valid records of the amount you paid yourself, and the payroll system of your business ready for any and all audit of your claim. Like the IRS, the unemployment system is much more likely to look closely at a claim that has any kind of funny looking doctoring going on with it, for example if you show that you worked and made exactly the barest minimum each week that you could still work and draw a claim. And they're not going to be able to verify those earnings through their state wide covered employer records, so they'd want to see what sort of business it was, and how you were being paid**************

No, as everyone has said, working at your own business does NOT constitute a job search. You must be able and available for other full time work. If your part time business is taking up too much of your time for you to do worksearches and have the availability for another full time job, you've got too much of a job to qualify for unemployment insurance. Remember, the criteria is to imagine that you're drawing benefits, working at developing your home grown business into a full time job, and someone who doesn't like you calls in and reports you for working and drawing (a scenario that is remarkably common!) and they send out an auditor to observe you and require you to prove you are eligible. Would you pass the test, or would you end up paying all the money back with penalties?

 

[davew128]

But if for accuracy's sake, you did report the wages you paid yourself in the part time business, a few hundred a week, you certainly need to be able to have really valid records of the amount you paid yourself, and the payroll system of your business ready for any and all audit of your claim.

Truly self employed people do not have payroll for themselves.

 

[commentator]

They should have some really good records of how much they paid themselves, and when. How much money they took from the business as pay/profit for themselves, and when. If they want to try to claim unemployment benefits while they're doing this, anyway. I think that if his employer terminates him, and this OP moves forward with the business, he's going to be in very murky territory if he tries to claim he's making xxx amount from the business a week or something like this for unemployment purposes.

 

[davew128]

They should have some really good records of how much they paid themselves, and when. How much money they took from the business as pay/profit for themselves, and when.

None of what you just wrote applies to a self employed person. A self employed person does not pay themself. EVER. All net income is profit. How much cash they take out is wholly irrelevant.

 

[commentator]

Quote: What I would like to do is claim my self employment earnings the same way I would part time employment, and have that week's check reduced by the amount earned. (I think that's what they do with part time work). That would let me extend my weeks until my pool of funds is exhausted

This person, if they intend to do the above, show themselves as being paid each week from their self employment, had better be keeping some darn fine "payroll" records for audit purposes regarding their unemployment benefits.

 

[davew128]

Quote: What I would like to do is claim my self employment earnings the same way I would part time employment, and have that week's check reduced by the amount earned. (I think that's what they do with part time work). That would let me extend my weeks until my pool of funds is exhausted

This person, if they intend to do the above, show themselves as being paid each week from their self employment, had better be keeping some darn fine "payroll" records for audit purposes regarding their unemployment benefits.

For those of us who work in the tax field, thats called keeping books and records. Just like any OTHER business.

 

[HomeGuru]

What is it called for those not working in the tax field?