Indiana - Can severance payment affect your unemployment benefits?
My plant in Indiana closed their doors March 24th. We did receive a severance package but that can't disrupt our unemployment benefits can it ? I was watching Suzi Orman on Oprah several weeks back and she stated that it couldn't. Would much appreciate your comment.
Suzi did, did she?
Severance, buyouts, and any other kind of dismissal payment can have an effect on your unemployment benefits, but here I go again .. sounding like a broken record .. This can and does vary from state to state. Entitlement to unemployment benefits is not equal in these United States.
The very best (I'm not kidding) starting place for getting the basics about unemployment FOR ANY STATE is the United States Department of Labor. It's easy to access and it's laid out very well.
And lucky for us, it addresses this very issue of severance payments and unemployment benefits.
It's found by going to this page
then clicking on the current year and then clicking on Non-Monetary Eligibility and the STATE by STATE information about severance or dismissal payment is found in TABLE-13.
Other tables in that very same PDF can let a person know about the effect of vacation pay, holiday pay, back pay, retirement payments, social security benefits, and worker's comp payments on their unemployment benefits.
You'll notice that Indiana has a regulation which excludes greater of $3 or one-fifth your WBA (weekly benefit amount) from other than BP (base period) employer.
It is this last little bit of information that would prompt me to find the Indiana regulation, especially since most people who have been laid off from long term employment will have only the one employer in their base period.
You can research Indiana unemployment law from this page.
Take a look at IC 22-4-15-4 and what it says under (c).
If severance is considered wages, a state usually wants to know how many weeks of wages it represents. It can be advatageous to know this because you can file for unemployment when this period of time has passed and the severance pay will be in your base period still. You do not have to file immediately after losing a job.
Most people never look at anything, but whether they can get it or not .. I think one should also be concerned with how much unemployment pay
you can expect and when is the optimal time to file.
Hope this helps you to figure it out.