How Long Do I Have To Work To Qualify for Unemployment?

Unemployment insurance (UI) helps millions of American workers each year support themselves and their families. While all states follow guidelines set by federal law, each state is free to establish the eligibility requirements for unemployment benefits in their state. Most states have an agency dedicated to operating their unemployment insurance programs. 

States require claimants to have worked for a minimum period of time to be eligible for unemployment benefits. Because each state has different laws about the eligibility requirement for unemployment benefits, the amount of time required to qualify will depend on the laws of your state. This article will summarize the amount of time that UI claimants must work to qualify for benefits.

How States Determine Unemployment Eligibility

Unemployment benefits are funded by payroll taxes on employers rather than taxes on individual citizens. They’re also funded by the Federal Unemployment Tax Act (FUTA), a mandatory governmental insurance system. States base employer contributions on the amount of wages paid by an employer, the amount the employer has already contributed to the state unemployment fund, and the amount of compensation that discharged employees have received from the state unemployment fund. 

Each state administers its own separate unemployment insurance program using federal guidelines and standards. The secretary of labor must approve each state program. Federal and state laws are used to determine which claimants are eligible for compensation, the amount of compensation, and the period of time that compensation is paid.

In the past, unemployment compensation has only been available to wage earners who work for other individuals or business entities. Independent contractors and self-employed individuals were ineligible for these benefits. Federal and state COVID-19 relief legislation has expanded benefit eligibility, temporarily, to include independent contractors and self-employed individuals.

States evaluate claims for regular unemployment benefits based on past wages, job separation(s), and other requirements for eligibility that are ongoing. Applicants must provide important personal information, such as their Social Security number, as well as their contact information, like a phone number and mailing address.

In addition to meeting all eligibility requirements when filing a claim, applicants must also meet requirements when certifying for UI benefits. Certifying is the process of informing the unemployment office that you’re still unemployed and eligible to continue receiving benefits by answering basic questions every two weeks.

The Base Period

For a benefit year, applicants are required to meet state income and work requirements for a timeframe known as the base period. The base period differs by state, but it's often the year ending about six months before you filed your claim for unemployment benefits. In many states, the base period is the first four of the last five completed quarters prior to the date you first filed your application for benefits. 

Some states will adjust the base period for an applicant under certain circumstances. The standard base period may not capture your most recent work activities. Because of this gap, some states allow you to file a claim using an alternate base period to determine eligibility. This alternate period is typically the four most recent calendar quarters before filing your claim. 

California requires that applicants must have earned enough wages through full-time or part-time work during the base period to establish a claim, and be:

• Totally or partially unemployed;

• Unemployed through no fault of their own (layoff);

• Physically able to work;

• Available for work; and

• Ready and willing to accept work immediately.

Earnings Requirements

Qualifying wages are earnings for which your employer paid unemployment insurance premiums. You have to earn a minimum amount of qualifying wages during the timeframe of the base period that qualifies you to collect unemployment. Some states may look at your earnings over the entire base period as opposed to the qualifying months only. 

A state unemployment agency will look to see that you worked for at least two of the calendar quarters in the base period. It may only look at your highest-earning quarter to see if you qualify for unemployment benefits. Many states use this test while others use it in combination with other methods of measuring income.

If you are eligible for unemployment compensation benefits, your state will likely issue you a debit card (direct or electronic payment card). This debit card will be mailed to you after your claim is approved. You’ll activate it as you normally would your bank’s debit card with a personal identification number (PIN). If mailed, your benefit payments will be sent to you based on a schedule determined by your local unemployment office. Your unemployment insurance debit card works like any bank debit card. You can make cash withdrawals at ATMs with this card or use it to buy goods and services.

Examples of State Calculations

Unemployment is administered by state agencies in compliance with federal guidelines. Here we’ll look at six states to see how they calculate unemployment benefits differently.

Georgia

In Georgia, the standard base period is the first four of the last five calendar quarters. Georgia also offers an alternative base period when benefits cannot be established under the standard base period. The alternate base period is the most recent four calendar quarters.

Applicants must have earned qualifying wages in at least two quarters during the base period to meet the earnings requirement in Georgia. Applicants in Georgia must have earned at least $1,134 in each of their two qualifying quarters. The total wages for the base period must exceed 1.5 times the wages in the quarters with the highest earnings.

California

California calculates the base period and alternative base period in the same way that Georgia does. The alternative base period is used in California only for applicants who don't qualify under the standard base period. California requires that you earned $1,300 in the highest quarter of your base period or $900 in your highest quarter and total base period earnings of 1.25 times your high quarter earnings.

Some states, like California, provide unemployment benefits to workers who are disabled. The funding for these programs in California comes from a tax on employees.

Texas

Your base period is the first four of the last five completed calendar quarters before the effective date of your initial claim. Texas does not use the quarter in which you file or the preceding quarter but the one-year period before these two quarters. The effective date is the Sunday of the week in which you file your application. 

Texas reviews whether you have wages in more than one of the four base period calendar quarters. This is the basis of your potential unemployment benefit amounts.

Ohio

Ohio uses a base period similar to that of California and Georgia. The base period in Ohio is the earliest four of the five complete calendar quarters before you filed your claim for benefits. For example, if you filed your claim in August of 2021, the base period would be from April 1, 2020, through March 31, 2021.

If you worked 20 weeks, but the weeks do not fall within the base period or your average weekly wage was less than the established minimum within the regular base period, you may still be able to establish a right to benefits if the weeks fall within the alternate base period. If you apply between August and October, the alternate base period will be August 2020 through July of this year.

If you file your application during 2021, you must have an average weekly wage of at least $280 before taxes or other deductions. The average weekly wage is determined by dividing total wages earned during the base period, from any employer who pays unemployment contributions, by the total number of weeks worked during the same base period for the same employer(s). 

New York

Like Georgia, California, and Ohio, the state of New York uses a “basic base period” defined as the first four of the last five completed calendar quarters before the quarter in which you file an application for benefits. If you are filing a new unemployment insurance claim in New York, the day you should apply is based on the first letter of your last name.

To qualify for benefits in New York: 

• You must have worked and been paid wages for work in at least two calendar quarters in your base period;

• You must have been paid at least $2,600 in wages in one of the calendar quarters in your base period (for claims filed in 2020); and

• The total wages paid to you in your base period must be 1.5 times your high quarter wages.

New York uses up to $11,088 of your high quarter earnings to determine if you qualify. You must have earned at least half that amount — $5,544 — in the other base period quarters.

Colorado

Colorado also uses a standard base period defined as the first four of the last five completed calendar quarters before you initiated an unemployment claim. Colorado also offers an alternate base period. This uses the last four completed calendar quarters rather than the first four completed calendar quarters.

Claimants in Colorado must have earned at least $2,500 in wages from January through December 2020 or from April 2020 through March 2021. In effect, you must have earned $2,500 during your base period or 40 times the weekly benefit amount (WBA) — whichever yields the greater amount is used to compute eligibility. 

If using the WBA method, you must have worked during at least two quarters of the base period. The WBA is computed by multiplying the two highest quarter wages by 1/26. The minimum earnings for the two quarters under consideration is $1,084.

The COVID Relief Acts Provide Temporary Expansion of Unemployment Benefits

During economic recessions, the federal government provides emergency assistance to states, which helps extend the time individuals receive unemployment benefits. A federal law becomes temporarily effective that authorizes the transfer of money to a state from an account known as an Extended Unemployment Account. States can access this account when the employment rate reaches a designated percentage within the state or the country as a whole.

In times of extreme need, such as the recent COVID-19 pandemic, Congress may also act. It recently approved the American Rescue Plan Act of 2021 to extend federal unemployment benefits provided during the coronavirus pandemic by the CARES (Coronavirus Aid, Relief, and Economic Security) Act. This legislation:

• Continues the federal increase for all unemployment benefits, which adds $300 to each week of benefit payments through September 4, 2021;

• Extends Pandemic Unemployment Assistance (PUA) and Pandemic Emergency Unemployment Compensation (PEUC) up to 29 weeks through September 4, 2021;

• Continues the federally funded FED-ED through September 11, 2021, providing up to 20 weeks of benefits; and

• Adds an additional $100 per week for people who qualify for regular unemployment insurance benefits and earned self-employment income.

Due to the impact of COVID-19, California made the following temporary exceptions for all unemployment insurance claims until further notice:

• The seven-day waiting period is waived for claims beginning on or after January 19, 2020. After you submit your first two-week continued certification, you will be paid for the first week of your claim.

• While applicants are not currently required to look for work each week to be eligible for benefits, starting July 11, 2021, most people collecting unemployment will be expected to look for work to maintain their eligibility for unemployment benefits. California offers help to applicants who may have trouble meeting the work-search requirement.

Anyone who hasn’t earned enough wages to meet the work requirements necessary for regular unemployment may be eligible for Pandemic Unemployment Assistance (PUA). These benefits expire in September of 2021. Many states have already voluntarily ended their PUA programs.

Independent contractors and self-employed workers aren't usually eligible for regular unemployment insurance benefits regardless of the length of time they have worked. But currently, these workers may be eligible for PUA if their state has expanded these benefits.

Let’s Summarize…

In order for you to qualify for unemployment benefits, you must be 

• Unemployed through no fault of your own;

• Able and available to work; and

• Actively seeking work. 

In addition to the above requirements, you must have earned a minimum amount of wages to qualify. In most states, eligibility for unemployment benefits is based on the wages the employee has earned during a timeframe known as the base period.  Most states use a base period defined as the first four of the last five completed quarters prior to the date that you first applied for unemployment benefits. While most states use a standard base period, many offer an alternate base period. 

The eligibility requirements for unemployment can seem complicated at first, but knowing whether you are eligible to file for benefits is extremely useful information to have. Hopefully, this article has broken down some of the more complex terms and requirements to give you a better understanding of whether you could be eligible or not and provided you with additional resources to learn more about your own state's individual requirements.