(California)
Years ago I created an LLC to:
– Secure a name
– Secure a URL
– Be available if/when I created/released a smartphone app, as LLC’s are REQ by the apple store. I have yet to design or release anything under the LLC name.
That said, I’ve been a FT employee for 7 years. The last 4 I’ve been remote in CA (with my company HDQ in PAâalthough they have offices in several states). Most recently they let me know that they need to “let me go” as they are consolidating resources to two on-site locations (one is 50 miles away, the other 3k miles away) and would require me (and my family) to relocate. So, they put together a package. In any event I was not immediately shown the door and will still working FT for them through the separation date.
From what I understand from this HR conversationâI should call to file for CA unemployment the day after my separation date but had a few questions.
1) Can I file for unemployment benefits from my FT employer if I have an in-active LLC?
2) If I want to supplement my unemployment benefits (bc the max does not cover my mortgage/expenses) while searching for FT work w/ some freelance through the LLC will this jeopardize my claim?
As an asideâthis company also mentioned hiring me “back” (remotely) for contract (and they REQ LLC’s for any contractor). As I am a little dismayed that the company let me go (I’ve had 7 years of stellar reviews and 3 major promotionsâand have been quite loyal) only to discuss hiring me for contract I am not sure I want to go this routeâespecially if it impacts my unemployment benefits.
As a second asideâI should mention that I was on STD Fall of 2012 after a cervical injury and had returned to FTE January 2013. My return to work doctors note included restrictions and ability to go to Physical Therapy, doctors/surgeons/specialists, etc….âall of which they were agreeable to on paperâbut often got a lot of annoyed voices/reactions when I needed to leave for an appt (1-hr out of 10-12 hour days, outside of spotty weekendsâand I don’t take lunch). Some of these restrictions just spell out best practices for ergonomic work stations (which I have) and stretches, etc…Anyway, my last review was excellent in Marchâand thus this “lay off” smells a bit suspicious considering I know I am now a liability (health wiseâinsurance wise) to the company. In fact I’ve mentioned my stress and concern for being laid off w/ my PT therapist, doctors, etc…since my return to work. They are all a little surprised that in fact this did happen.
Thanks so muchâ
Hi,
If California is the state liable to pay the benefits, then an inactive LLC should not be of concern regarding collecting benefits. See Total/Partial Unemployment in the California unemployment determination guide to know what exactly makes having a business in CA an eligibility concern. The concern (issue) for any UI claims dept. when a claimant has an apparent interest in a side business is whether they are truly able and available to accept suitable at will employment and that they are actually looking for work as required by state unemployment law.
If it is PA benefits that LLC.. might make benefit eligibility a more complicated matter with the LLC potentially causing eligibility problems having to do with appearing to be self employed.
The offer of a contract position either before the actual layoff, or as a sort of recall, in the future is concerning to me as it might be something an employer would do if they hope you refuse so, your refusal, might spawn the basis of a response that you were laid off, but you also refused continuing suitable work.
This tactical strategy of reporting to an unemployment department some refused work is precisely the reason I didn’t refuse, in 2006 to come back to work as a benefitless temp employee. I remained a temp doing the job I had always done for nearly three more years.
Another concern about accepting contract positions is some employers will misclassify contract employees as independent contractors (aka self employed) to avoid paying UI taxes and any other tax.
Much luck, but remember, if that contract work ends up being offered as “self employment”, it could be a substantial change to the current terms and conditions of your employment that actually could allow a person to refuse, without repercussions to receiving benefits .. because the change to terms and/or conditions can make a job offer of continuing employment, not suitable work.