If you received severance pay in a lump sum, DUA will prorate the severance pay and your disqualification will run for the number of weeks for which you are receiving severance pay.
Example: If a claim were filed on March 14, 2002, the benefit year would begin on March 10, 2002. The benefit year would ordinarily end on March 8, 2003.
In this example, if a claimant received eight weeks of severance pay, the benefit year end date would be extended by eight weeks, for a new date of May 3, 2003.
The claimant would have until that date to collect the benefit amount of that claim, if he/she was unable to find new employment.
In general, the following are disqualifying and would result in an extension of the benefit year:
- payment in lieu of notice
- termination pay
- severance pay
- dismissal pay
If the claimant has received severance pay under the official designation of a plant closing, the severance pay would not be disqualifying provided the severance is paid in a lump sum.
If the claimant received severance pay in any denomination other than a lump sum payment, under the official designation of a plant closing, the claimant will be subject to disqualification for the period of time the severance pay is applied.
A plant closing designation may be made when there were more than 50 workers employed at a work location in the prior six-month period, and there was a reduction in force of at least 50 percent.
If the claimant was required to sign what is known as a "release of claims" as a condition of receiving severance pay, the severance pay would not be disqualifying.
A separate determination will be made on the receipt of severance pay. The service representative will explain to you how your receipt of severance pay affects your receipt of benefits. If you disagree with this determination, you have the right to file an appeal.