Can You Keep Your Unemployment Benefits if You Refuse to Return to Work?

Due to the coronavirus outbreak, a record 38.6 million Americans have filed for unemployment benefits since March. In addition to people who have permanently lost their jobs, workers who are turning to unemployment benefits to cover living expenses include people who have been furloughed or temporarily laid off.

As states begin to reopen retail stores, restaurants, and factories, some people may be asked to return to work and begin earning a paycheck again. But should they? In addition to concerns about health in the workplace, some who are returning to lower pay or reduced working hours face the reality that they may make more money on unemployment than by going back to work under these new conditions.

If you’re not sure if it’s time to go back to work, here’s an overview of what happens to unemployment benefits in some common scenarios:

If you are told to go back to work but you feel it isn’t safe

You could be in a situation where your employer has made the choice to reopen their doors and asked you to come back to work. Going back to work, especially to a job that involves a lot of person-to-person interaction, could make you feel unsafe.

Even though you might feel your health is jeopardized, voluntarily quitting your job because you are afraid of COVID-19 exposure does not make you eligible for unemployment assistance, according to the Department of Labor. Businesses must follow guidelines from the CDC and the Occupational Safety and Health Administration (OSHA) to provide a safe work environment. That means providing sanitation stations, gloves and masks, and maintaining social distancing guidelines.

If you feel that your employer has not provided the right safety measures to allow you to do your job, the next step is to document how your employer is breaking OSHA or CDC guidelines. Then you can report it to OSHA by filing a health and safety complaint. This is not a quick or easy fix, but it could help make you and your colleagues safer.

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If you make more money with unemployment than with a job

Another reason you might consider turning down employment is if you make more money with your unemployment benefits than with your salary. Unemployment benefits through the coronavirus stimulus package were meant to be fair and temporary. That’s why every person who qualified is able to receive an additional $600 per week, no matter where they live or what their living expenses might be.

Economists at the University of Chicago found that 68% of unemployed workers eligible for unemployment insurance will receive benefits that are higher than their lost earnings. Under normal conditions, unemployment benefits would not be able to cover 100% of wages for the average worker, but the stimulus package makes that possible for some.

As much as we’d like to collect that extra cash while staying at home, these benefits have an expiration date. The extra money provided by the stimulus package is set to end on July 31. While the HEROES Act includes a proposal to extend that expiration date to January 31, 2021, the bill has not yet passed at the time of publication.

It’s easy to see that receiving a bigger paycheck while being safe at home in quarantine might be more attractive than returning to work with less pay and more exposure to COVID-19. The bottom line here though, is this: if you are asked to return to work and refuse (in most situations) you will most likely lose your benefits.

If you were furloughed and asked to return to work

Furloughed employees can collect unemployment, plus non-monetary employer benefits, like retirement and health insurance, and take temporary jobs like food delivery or other side gigs. That was the case for 100,000 Disney employees who were furloughed in April, for example. Now those employees are being asked to head back to work.

Since your employer still pays for benefits and wants to keep you as an employee, a furlough is meant to be temporary. When the furlough period ends and you are asked to return to work, you’ll probably want to accept that offer. And therefore, you’ll no longer be eligible for unemployment benefits.

You could reject the job offer and stay on unemployment benefits only if you meet certain exemptions, like being sick as a result of COVID-19, or are caring for a child who cannot attend school. While this could sustain you for the short term, eventually you’ll be left searching for a new job in a market with a lot of competition.

Where unemployment benefits currently stand

In general, unemployment benefits can be paid for a maximum of 26 weeks in most states. Each state determines how much they can pay you in unemployment benefits, so check with your state’s department of labor. The CARES Act has also provided extended benefits during the pandemic, including:

• An additional $600 per week through July 31 to anyone receiving state unemployment benefits

• An extension of benefits through December 31 based on your regular state claim

• Federal Pandemic Unemployment Assistance if you do not qualify for regular unemployment benefits or have exhausted the federal benefits

Pandemic Unemployment Assistance

It’s possible to keep your unemployment benefits if you refuse to return to work through the Pandemic Unemployment Assistance (PUA). PUA was created for the self-employed, gig workers, contract workers, or those who have previously exhausted their unemployment benefits. You could be covered if one of these reasons apply due to the coronavirus:

• You or someone in your household has been diagnosed with coronavirus or have symptoms and waiting to be diagnosed

• A family member or someone in your household has coronavirus and you must care for them

• You are the caretaker for a child whose school or childcare is closed

• You have been quarantined by a medical professional or government body

• You have lost your job because of the coronavirus

• You are the main source of income for your household due to a death caused by the coronavirus

• You quit your job because of the coronavirus

• Your workplace is closed because of the coronavirus

• You could not start a new job as scheduled due to the coronavirus

Know your rights

When it comes to your employment and your safety, your employer should take preventative measures to make your workplace as safe an environment as possible. If you have been asked to return to work, carefully consider your options and ask yourself: Would refusing to return to work make it harder for you to find a replacement job later?

Although the temporary relief from extended unemployment benefits could help you in the short term, these funds will eventually run out. Try to come up with a financial plan that looks past the next few weeks and into the next few years. A long-term plan can help you improve your financial situation through the pandemic.

Unemployment benefits only go so far

At the end of the day, your debt and financial future are still important. If your unemployment benefits aren’t enough to help you with your debt payments or you’re worried about falling behind on payments, it might be time to seek out advice. Freedom Debt Relief is here to help you understand your options for dealing with your debt, including our debt settlement program. Our Certified Debt Consultants can help you find a solution that will put you on the path to a better financial future. Find out if you qualify now.

Learn More:

• Why Millennials are Being Hit Hard by the Covid-19 Recession (Freedom Debt Relief)

• Pros and Cons of Applying for a Personal Loan During COVID-19 (Freedom Debt Relief)

• For Many, $600 Jobless Benefit Makes It Hard to Return to Work (NPR)

• Can You Refuse to go Back to Work and Still Claim Unemployment Benefits (CNBC)