Chapter 2 Unemployment & Disability Insurance Benefits
Section 2 - Claims & Benefits for Unemployment Insurance
Basic Eligibility Requirements
Amount of Benefits
Additional Claims for Benefits
Relief of Benefit Charges for Disqualifying Separations
New Hire Cross-Match
Claims & Benefits for Unemployment Insurance
Under the Unemployment Compensation Law, you are required to pay unemployment insurance taxes and to provide the Division of Unemployment Insurance with certain information about your employees if they file claims for benefits. All information you give to the Division is confidential and privileged. You should be familiar with the provisions of the law relating to basic and continuing qualifications for benefits and to the amount of money a claimant may receive.
It is important that you give your separated employees Form BC-10, “Instructions for Claiming Unemployment Benefits,” showing your correct name, your New Jersey Employer Identification Number, and the address to which a request for information should be mailed. You can get supplies of this separation notice by contacting the Bureau of Program Services and Standards at (609) 292-2347.
The Unemployment Compensation Law provides some income to an unemployed person in the interval between one period of employment and another. The amount of unemployment insurance benefits that a claimant is potentially eligible to receive is directly related to his/her actual earnings during the base-year (see below for base-year definition). To be monetarily eligible for benefits, the claimant must have had wages in covered employment in each of 20 base weeks or, in the alternative, have earned during the base period, a specific dollar amount or more in remuneration.
On January 29, 2001, Chapter 17, P.L. 2001, an act modifying certain New Jersey unemployment and disability insurance benefit eligibility requirements, was signed into law. The law simplified the basic eligibility requirements. Effective January 1, 2001, the base week amount is equal to 20 times the state hourly minimum wage ($168 in 2017), and the alternate earnings test is equal to 1,000 times the state hourly minimum wage ($8,400 in 2017). [Previously, the base week amount and the alternate earnings test were tied to the Statewide Average Weekly Wage (the base week amount was equal to 20% of the SAWW; the alternate earnings test was equal to 12 times the SAWW) and were recalculated annually.] The 2001 legislation ties the base week amount and the alternate earnings test to the state hourly minimum wage, and will change only when the state minimum hourly wage changes.
In addition, in order to be entitled to receive benefits for any week claimed, the claimant must not be subject to any of the disqualification or ineligibility conditions listed here.
When a person becomes unemployed and files a claim for benefits, his/her monetary eligibility is determined by the wage information available in our central computer. Employers submit the wage information quarterly via Form WR-30, “Employer Report of Wages Paid.” The claimant’s base-year period is established at this time. The regular base year is defined as the first four of the last five completed calendar quarters. All claims are initially tested for monetary validity using this regular base-year period. The wages compensating this four-quarter period form the basis for the computation of benefit credit. The chart lists the calendar quarters and the corresponding base-year for claims dated between January 2012 and June 2013:
|If the claim is dated in:
|The claim is based on employment from:
October 1, 2015
September 30, 2016
January 1, 2016
December 31, 2016
April 1, 2016
March 31, 2017
July 1, 2016
June 30, 2017
October 1, 2016
September 30, 2017
January 1, 2017
December 31, 2017
For claims originally determined invalid under the regular base-year period, there are two alternative base-year periods that can be used to determine monetary eligibility. Alternative Base Year #1 consists of the four most recently completed calendar quarters preceding the date of claim, and Alternative Base Year #2 consists of the three most recently completed calendar quarters preceding the date of claim and weeks in the filing quarter up to the date of the claim. Alternative Base Year #2 can be used only when the claim is still invalid after testing validity using the Regular and Alternative #1 base years.
As soon as a claim is filed, all of the claimant’s base-year employers are notified of the Division’s initial monetary determination on the Form BC-3E, “Notice to Employer of Monetary Determination.” Form BC-3E.1, “Request for Separation Information,” attached to Form BC-3E, must be completed and returned to the Division only if:
(1) the claimant was separated for reason other than lack of work;
(2) the claimant is receiving a company pension;
(3) the claimant received wages for a period after his/her last day of work (e.g., vacation pay, severance pay, payment in lieu of notice, etc.);
(4) the claimant’s separation is temporary, and the claimant has a definite date of recall.
NOTE: If the claimant worked for you only during the lag period—that is, the calendar quarter in which he/she filed a new claim and the immediately preceding calendar quarter—the Division will send you a Form BC-28, “Request for Separation Information.” You must complete this form in accordance with the instructions provided and return it within 10 days from the date of mailing.
It is important to give complete details about the reason a person is no longer in your employ when requested. The Division will determine, from the facts you report about the separation, whether the claimant is eligible to receive benefits. The information you provide may also be used to determine if you should be relieved of charges to your experience rating account. See “Relief of Benefit Charges for Disqualifying Separations.”
Maximum Weekly Benefit Rate - The maximum weekly benefit rate payable is 56 2/3 percent of the statewide average weekly wage paid to workers by employers subject to the law. The Commissioner of Labor and Workforce Development determines the statewide average wage on or before September 1 in each year based on the wages paid during the preceding calendar year. It is effective for benefit years started in the following calendar year. The maximum weekly benefit rate payable to claimants whose benefit years begin in 2017 is $677.
Weekly Benefit Rate - The amount payable each week is computed individually on the basis of the claimant’s average weekly wage in the base year. Each claimant is to be paid 60 percent of his/her average weekly wage, subject to the maximum, as explained above. A claimant who did not earn sufficient wages in his/her base year to receive the maximum weekly benefit rate payable may collect dependency benefits. Dependency benefits are payable at 7 percent of the claimant’s weekly benefit rate for the first dependent and 4 percent for each of the next two dependents, provided that the claimant’s spouse or civil union partner is unemployed during the week in which the claim is established.
“Dependent” means an individual who is unemployed during the calendar week in which the claimant files an initial or transitional claim, and is the claimant’s:
(1) Spouse or civil union partner; that is, a person to whom the claimant is legally married; or in a legal civil union; or
(2) Dependent unmarried child; that is, son, daughter, stepson, stepdaughter, legally adopted son or legally adopted daughter under the age of 19, or under the age of 22 and attending an educational institution as defined in the law.
Maximum Benefit Amount - New Jersey’s unemployed workers are eligible for benefits equal to the worker’s number of base weeks in the base-year period, up to a maximum of 26 weeks.
Partial Benefits - Individuals who work less than full time due to lack of work may be eligible for partial benefits. To be eligible for partial benefits, the individual must not be employed for more than 80% of the normal hours worked in the occupation. The partial weekly benefit amount payable is computed by subtracting the claimant’s gross wages (fractional part of a dollar omitted) for the week claimed from 120 percent of the claimant’s weekly benefit rate. The partial benefit amount is computed to the next lower dollar, if not already a multiple thereof.
Certain company pensions or other type of retirement benefits are offset against unemployment compensation benefits. If the base-year employer and worker contributed to the cost of the pension, the unemployment insurance payment will be reduced by an amount equal to half of the pension amount. If a base-year employer paid the entire cost, the full pension payment will be deducted. If the worker paid the whole cost of the pension, no deduction will be made. Social Security pension income is not offset against unemployment benefits.
Form BC-2, “Request for Wage and Separation Information,” will be sent to you only if:
(1) the Division has no record of receiving your quarterly wage information for the named claimant on a properly completed Form WR-30, “Employer Report of Wages Paid,” or
(2) weekly wage information (instead of quarterly wage information) is needed to determine a claimant’s benefit entitlement, or
(3) alternative base-week amounts or base-year periods must be used to test monetary eligibility.
In all cases, you must report all wages earned in the base year specified. This includes regular pay, overtime, holiday pay, sick pay and back pay awards. The request that the Division sends to you will specify the exact beginning and ending dates of that period.
The law provides that if you fail to return the request within 10 days from the date of mailing thereon, you will be subject to an INITIAL penalty of $25 for each report not submitted within10 days of the request, and to an ADDITIONAL $25 penalty for the next 10-day period of noncompliance.
There are times when a person reopens a claim. This occurs when a claimant returns to work, then becomes unemployed again within 52 weeks from the date of the original claim. When a claim is reopened, the Division must obtain information from his/her most recent employer(s) on Form BC-28, “Request for Separation Information,” as to why the individual is no longer working. If you know of any information that might affect the payment of the reopened claim, you are required by law to report this information when you receive such a request. The Division can approve or deny a claim only on established facts.
Under certain conditions a claimant may be disqualified from receiving unemployment insurance benefits. These reasons and the penalties involved are listed below:
(1) Voluntarily leaving work without good cause attributable to such work. The claimant is disqualified for the week in which the quit occurs and for each week thereafter until he/she has earned in employment at least six times the claim’s weekly benefit rate in at least four weeks of employment if the separation occurs before July 1, 2010. For separations on July 1, 2010, and later, the claimant is disqualified for the week in which the quit occurs and for each week afterward, until the claimant has earned in employment at least 10 times the claim’s weekly benefit rate in at least eight weeks of employment. If the claimant is subsequently separated from this employer for other than lack of work, a new determination will be made.
(2) Discharge for simple misconduct connected with the work (insubordination, lateness or absences with no written warnings), for separations occurring before July 1, 2010. The claimant is disqualified for the week in which the misconduct occurs and for the seven weeks that immediately follow such week. For separations on July 1, 2010, and later, the claimant is disqualified for the week in which the simple misconduct occurred and for the seven weeks that immediately follow.
(3) Discharge for severe misconduct connected with the work (behavior that demonstrates a severe indifference to the employer’s interest but may not be a crime, such as use of drugs/alcohol on the job, repeated violations of a company rule, repeated lateness or absences after receiving a written warning from the employer, destruction/theft of company property or misuse of benefits) occurring July 1, 2010, or later. The claimant is disqualified indefinitely until he or she works in new covered employment for at least four weeks and earns at least six times the claim’s weekly benefit rate. There is no severe misconduct issue on separations occurring before July 1, 2010.
(4) Discharge for gross misconduct connected with the work: that is, a work-related act punishable as a crime of the first, second, third or fourth degree under the New Jersey Code of Criminal Justice. For separations before July 1, 2010, the claimant is disqualified for the week in which the discharge occurs and for each week thereafter until he/she has earned in four or more weeks of covered employment at least six times the claim’s weekly benefit rate. For separations occurring July 1, 2010, and later, the claimant is disqualified for the week in which the discharge occurred and for each week afterward until he/she has earned in eight or more weeks of covered employment at least 10 times the claim’s weekly benefit rate. In addition, wages earned with that employer prior to the day of discharge cannot be used for benefit purposes or to remove a disqualification.
(5) Failure, without good cause, to apply for or accept suitable work. A disqualification shall continue for the week in which such failure occurred and for the three weeks that immediately follow such week.
(6) Unemployed due to a labor dispute. Such disqualification continues for the duration of the labor dispute or until it has been determined that conditions have changed so that there is no longer substantial curtailment of activity at the place of employment. However, if the employees were “locked out” by the employer, were not on strike immediately prior to the lockout, and have been directed by recognized union leadership to work under the preexisting terms and conditions of employment, the employees may be eligible for benefits.
(7) Benefits received illegally as the result of false or fraudulent representation. The claimant is disqualified from benefits for one year from the date of discovery by the Division, and subject to a fine of 25 percent of the total amount of benefits received illegally or $20 for each week of benefits received illegally, whichever is greater.
(8) Full-time attendance at a public or other nonprofit educational institution by a claimant whose training has not been approved by the Division to enhance the claimant’s employment opportunity, and who did not earn a major portion of his/her base-year wages while attending school. The claimant is disqualified until he/she is no longer a full-time student.
An individual may be ineligible for benefits for other reasons that do not involve the employer, in contrast to the aforementioned disqualifications, which generally do involve the employer. Ineligibility may be for a fixed period or may continue throughout the life of a claim or until the facts change. Reasons for ineligibility are:
(1) Failure to demonstrate availability to work.
(2) Failure to make an active search for work when required by the Division.
(3) Inability to work (See Chapter II, Section 5, on Temporary Disability Insurance).
(4) Failure to report to the One-Stop Career Center as directed by the Division, or failure to be available for scheduled telephone appointments.
(5) Any individual who is an officer of a corporation, or who has more than a 5 percent equitable or debt interest in the corporation, and who has base-year wages with the corporation will not be considered “unemployed” in any week during the individual’s term or ownership in the corporation. The claim will be invalid and the individual will be ineligible for benefits.
If the corporation permanently ceases operations and files for formal dissolution in accordance with the New Jersey Business Corporation Act, N.J.S.A. 14A:l-1 et seq.; or files for bankruptcy under Chapter 7 of the United States Bankruptcy Code, or if the individual’s corporate officer/owner status is terminated, the individual could be considered unemployed and may be eligible for a valid unemployment claim.
The Division depends on employers to provide complete and accurate information about the separation of any employee, so we can apply the provisions of the law to the facts of the claim in determining whether the claimant can be paid. This is why you are notified when a claim has been filed.
Whenever a separation issue is involved, the employer is requested to participate in the initial fact-finding interview. It is in your interest to have a member of your organization, who has knowledge regarding the circumstances of the separation, participate in such interview. The scheduled interview will be conducted by telephone. If it is not possible to participate in the interview, you should provide complete and accurate information when so requested.
Chapter 255, P.L. 1997, which is effective with unemployment claims dated January 4, 1998, and later, provides for the relief of charges of benefits paid to a claimant if the claimant’s employment by that employer ended in any way that would have disqualified the claimant if the claimant had applied for benefits at the time when that employment ended. This amendment does not apply to employers who elect reimbursable status. Prior to the enactment of this amendment, when an individual overcame a disqualification and was otherwise eligible for benefits, all of the individual’s base-year employers were charged for a portion of the benefits the individual received. While the eligibility of the claimant is not changed by this amendment, the employer’s account will not be charged for the benefits received by the claimant for periods that occur subsequent to the disqualifying separation.
NOTE: If a claimant files an appeal and the disqualification is overturned, you will be liable for applicable benefit charges. It is in your best interest to participate in all scheduled appeal hearings.
This amendment does not change the way benefits for non-disqualifying separations are charged. That is, the experience rating accounts of employers are charged for each benefit payment in proportion to the amount of wages that the employer paid the claimant during the base year as part of the total wages earned during the base year. If an employer is relieved of charges because of a disqualifying separation, the percentage of charge liability of the individual’s other base-year employers does not change.
When you are notified that an individual has filed a claim, and the reason for separation is other than lack of work, you should provide as much information as possible regarding the separation, attaching additional sheets if necessary. Complete and mail or fax the form to the address shown on the form.
The Division reviews the form to determine if the reason for separation is potentially disqualifying. If you are the claimant’s most recent employer and the reason for separation is potentially disqualifying, you will be notified of the fact-finding hearing. Hearings are conducted by telephone. If you are not the most recent separating employer, and you report a potentially disqualifying separation, the determination to relieve charges will be based on the written information supplied by you and the claimant. We may write or telephone you if we need additional information.
Employers reporting potentially disqualifying separations will be notified in writing if the individual’s separation is/would have been disqualifying under the law and, therefore, the employer should be relieved of charges. An employer may appeal the determination according to the instructions printed on the form.
The employer is the front line of defense against unemployment insurance fraud. Fraud is usually a “wage-benefit conflict,” which occurs when a claimant is working while collecting unemployment insurance benefits and not reporting his/her earnings to the Division.
Form B-187Q, “Unemployment Benefits Charged to Experience Rating Account,” is mailed to employers each quarter. The form is not a bill, but it is a statement providing the names and Social Security numbers of claimants who are collecting benefits against your account, the date they filed their claims, the compensable weeks they have been paid, and the amount paid in each of those weeks.
If a claimant returns to work for you, a chargeable employer, while continuing to collect unemployment benefits, indicate the return-to-work date in the space provided as the reason for protest. We will initiate an investigation upon receipt of the B-187Q.
If you have information that a claimant has been working for another employer while receiving unemployment benefits on your account, report the potential fraud immediately. You may do this online here. Alternatively, you may call the unemployment fraud hotline at (609) 777-4304, or fax your information to (609) 292-5593. You may report any case of unemployment fraud of which you become aware, regardless of whether the claimant ever worked for you. Reporting fraud will prompt an immediate investigation.
The Department’s primary fraud detection method is the computer cross-match of benefit payment records with the wage records submitted by employers on the quarterly WR-30, “Employer Report of Wages Paid.” If the cross-match indicates a possible overpayment, form BPC-98, “Weekly Wage Information Request,” is mailed to employers in order to obtain a weekly breakdown of any wages earned during weeks when benefits were collected.
Most overpayment investigations are conducted and resolved by mail and telephone. However, investigators may make unannounced, in-person visits to employers in order to expedite an investigation or to resolve a complex case. Employers are required by New Jersey Unemployment Compensation Law (N.J.S.A. 43:21-11(g) and N.J.A.C. 12:16-2) to provide employment records at any reasonable time to authorized representatives of the Department of Labor and Workforce Development.
Any overpayments detected, fraudulent or otherwise, to claimants collecting on your account will be credited to the account and may reduce your unemployment tax rate.
Employers are required to report basic information about employees who are newly hired, rehired, or who return to work after a separation from employment. The information is used to identify recipients of public assistance and unemployment and disability benefits who fail to report earnings. The basic information that employers report is:
Employee: Name, address, and Social Security number
Employer: Name, payroll address, and FEIN
Optional: Date of hire, date of birth, and gender
Employers have several options in reporting the data to the New Hire Operations Center that is administered by the New Jersey Department of Human Services. Data may be reported electronically (mailed diskette, tape, e-mail); hard copy (mail, fax, W-4, printed list, state form, or other); and online here.
The Division of Unemployment Insurance will use the new-hire information to help prevent overpayments and/or the early detection of overpayments through a cross match of payment records and initial claims with the new hire information.