Can I Get Unemployment if I Got a Severance in Indiana?
- For 2011, unemployed claimants can receive up to $390 in weekly unemployment benefits. The minimum amount of unemployment insurance benefits that applicants qualify for is $50. Starting Oct. 1, 2011, the Indiana Department of Workforce Development will reduce your weekly unemployment insurance benefits. If you currently receive unemployment insurance benefits and severance, the new law will not have an effect on your existing unemployment benefits.
- Prior to the 2011 legislative changes, the Indiana Department of Workforce Development denied unemployment insurance benefits to those receiving severance pay. Since the state considered employees receiving severance pay to be working on a full-time basis, they could not receive unemployment insurance benefits. However, in July of 2011, the Indiana General Assembly enacted new legislation affecting the filing of benefits after July of 2011.
- Under Indiana law, you must report any earnings, including part-time work earnings, severance pay, pension pay and self-employment pay. You must also include any bonuses, tips, commissions, vacation and sick payouts and pay in lieu of compensation. Generally, the Indiana Department of Workforce Development can reduce your weekly unemployment insurance benefits during the weeks in which your receive severance pay. If your employer pays a lump sum upon termination, the department will reduce your benefits, if at all, for that week. If you subsequently receive severance pay, and you do not report your severance payments, the department can charge you with unemployment filing fraud and require you to repay the overpaid unemployment insurance benefits.
- If you apply for benefits on or after Oct. 1, 2011, and you receive severance pay, the department will reduce your weekly unemployment insurance benefits by the amount of your weekly severance pay. For example, if the department qualifies you for $200 in weekly unemployment insurance benefits, and you receive $75 in weekly severance pay from your previous employer, the department will reduce your unemployment benefits by $75. Thus, you will receive $125 in weekly unemployment insurance benefits, and you can keep your severance pay.
