Question:
How does unemployment insurance in California work?
Answer:
The EDD handles unemployment insurance in California and will look at several things to determine if someone is eligible to receive benefits.
First Off, Who Administers Unemployment Insurance in California?
The Employment Development Department – the EDD. The EDD keeps track of businesses, employees, and all the payroll taxes get funneled to them.
How Is Unemployment Insurance Funded?
Unemployment insurance is funded though payroll taxes. These are taxes that come out of our wages. Each employer has a payroll tax rate that starts at a certain rate and can go up or down depending on the number of people who claim unemployment.
So What Are Some Of The Eligibility Requirements?
Here are three (3) basic things the EDD will look at to see if you are eligible for unemployment benefits.
1. The employee’s wages.
As for the employee’s wages, you need to have earned a certain amount of money during a certain amount of time. This is called the base period. The EDD will look at the employee’s wages, base period, and determine whether or not enough wages have been earned during that base period to make that person eligible for the benefits.
2. Whether or not the applicant is out of work at no fault of their own.
This is whether the employee was terminated or laid off. Typically, you cannot receive benefits if you choose to leave the job yourself.
3. Whether or not the applicant is ready, able, and willing to work.
When you apply, the EDD will have you certify that you reasonably searched for a job. This is because the EDD does not want unemployment to be an alternative to a job, just a stepping stone in between jobs.
More on California unemployment eligibility requirements here.
How Can You Apply And What Happens?
You can apply in four (4) ways: online, by mail, fax, or phone. The preferred method by the EDD is through the online application.
Once you apply, your paperwork will be mailed to you and it will tell you whether or not you have been approved to receive the benefits. If you do get an award, the notice will explain how much your award will be. The award is calculated by your highest paid quarter in your base period divided by 26. It is divided by 26 because the benefits in the program may last up to 26 weeks. It is important to note that under normal circumstances, the highest amount you will receive is $450 per week.
To Wrap Up….
California unemployment insurance in administered by the EDD and is funded through payroll taxes. For eligibility requirements to receive benefits the EDD will look at wages, whether or not the applicant was at fault for unemployment, and whether or not the applicant is ready, able, and willing to work. Lastly if you are eligible for the benefits, you can receive $450 per week for up to 26 weeks. If you still have lingering questions, feel free to reach out to our team for a free 30-minute consultation at bertie@inbetterwetrust.com. We’ll walk you through your additional questions!