Can I collect unemployment while collecting severance pay?

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Can I collect unemployment while collecting severance pay?

Asked on October 9, 2012 under Employment Labor Law, Texas

Answers:

M.D., Member, California and New York Bar / FreeAdvice Contributing Attorney

Answered 9 years ago | Contributor

Generally speaking, you can collect unemployment benefits if you're given a severance package. The reason is that severance pay is not considered to be earned “wages” that would otherwise count against your right to collect unemployment benefits.

That having been said, the rules for collecting benefits vary from state-to-state. Sometimes there is a short delay in eligibility for collecting such benefits depending on how the severance payout is stuctured. If severance is paid in a lump sum it will probably not affect unemployment benefits; if severance is paid over time (as if you are still on the payroll) then it may delay your ability to collect.

 


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