Kentucky. Company close with layoff and 3 month consult
The company that I have worked for full time for the last 9 years is being desolved. A new startup company has agreed to pay me as a consultant for the first three months of their startup to help facilitate the transition. The payment for consulting will not have tax withheld. How do I make sure that I am eligible during or after that period? This consulting agreement will not be anywhere near full time and I will be available for work. Again, I know this consulting job has a 3 month time frame and I will likely be unemployed after.
Okay, some things to consider. The consulting job will be reportable wages if you open the claim now.
But most states, including Kentucky, have a standard base period (the wages used to determine the weekly benefit amount) of the first 4 of the last five Completed quarters. This is relevant because whether you file now or three months from now the base period will be different. A base period is different from the "Benefit Year".
Anyone filing now between 4/1/09 and 6/30/09 will have a base period of 1/1/08 through 12/31/08. Beginning 7/1/09 through 9/30/09 it will be 4/1/08 through 3/31/09. I mention this because anyone else reading this who was laid off from a job they had not yet worked at for at least a year may be well advised to find out what wages are needed to qualify for unemployment.
In your case, you will want to look at whether you would be able to collect partial unemployment while working the consulting job. If it does not behoove
you to do so, you could wait and file three months down the road (if you're positive this "startup" won't offer you bonafide work which you may decide to refuse ... We all have to have good cause to refuse work too).
You can find out what Kentucky's or any states formulas for anything monetary is at the USDOL
under monetary eligibility. Partial benefits can be found at table 3-8 .. Kentucky uses an average weekly wage formula. The maximum benefit amount is $415 ( I do not know if this includes the $25 dollar increase from the feds or not.)
Once you estimate how much unemployment will pay, then you will be able to see if filing now and collecting partial benefits is something you should do now ... or wait. It's up to you when you file and as long as you understand that a qualifying "work separation" can be rendered useless if you have a disqualifying separation subsequent to the prior work, and the effect waiting or not waiting can have on your weekly benefit amount, you'll have the very basics under your belt.
Another thing you might want to check out while at the USDOL is "Coverage". The information is very relevant to contract workers, different type of sales jobs and others who are being paid as contract workers, but may in fact be employees.
If you are a consultant or self-employed nobody is paying any UI tax on the monies you receive, therefore it could affect the monetary health of any future base period .... just in case anyone needs to open another unemployment claim...God forbid.