Is it legal to work freelance while on unemployment if you claim it?

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Is it legal to work freelance while on unemployment if you claim it?

I was told by to take freelance work while collecting unemployment if I wanted to as long as I claimed it, which I did. Then they cancelled my benefits. I had an interview and explained the situation and was told it was fine. Now I receive a letter stating they have determined I am “self-employed”. What does that mean? I am looking for a full-time job. I had a full-time job that I was laid off from and am just trying to make ends meet. Do I appeal? Will it get overturned?

Asked on October 19, 2011 under Employment Labor Law, California

Answers:

SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 9 years ago | Contributor

Self-employed is what it sounds like: you do not have a boss or work for a company, but instead provide services to anyone who will hire you, like an independent contractor or freelancer, or sell some goods to anyone who chooses to buy them, like, say, someone who makes crafts at home and sells them.

There are two separate issues:

1) Individuals who are considered to be self-employed generally are not able to collect unemployment compensation; even if you are effectively earning little money, you are considered to be "employed" if you are self-employed (i.e. have a business, are a freelancer or consultant, etc.).

2) Even if you were eligible to get the benefits (they didn't the self-employment in your case a total bar), what you earn is offset against your benefits. If you earn, I think, more than 1/3 more than the amount of your benefits, you can't collect anything; if you earn less than that, you may collect something, but it will be greatly reduced.


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