Am I Entitled to Unemployment in Pennsylvania if I Accept a Voluntary Lay-Off?

My Employer Said it Would Not Contest My Pennsylvania Unemployment Claim; What Does That Mean?

I receive many phone calls from employees who accepted a voluntary lay-off (“reduction in force” or “RIF”) with a promise from their employer that it “would not contest unemployment,” only to later be denied unemployment benefits by the Pennsylvania Unemployment Service Center. Let me explain how this works.

When you apply for unemployment benefits, the Unemployment Service Center will immediately write to your employer to confirm your wages and the reason that you are no longer employed.  Correctly believing that it is required to provide such truthful information to the Service Center, the company truthfully states that you voluntarily accepted a RIF. In the employer's mind, and in fact, merely telling the Service Center these facts does not constitute "contesting your claim."

If I Accept a Voluntary Layoff, Can I Get Unemployment Benefits in Pennsylvania?

Depending upon the circumstances, the acceptance of a voluntary RIF is deemed a voluntary quit.  The key here is whether you were in line for immediate termination if you did not accept the voluntary RIF.  Unless you were slated for immediate termination (absent accepting the voluntary RIF), accepting the voluntary RIF will be deemed to be a quit "without necessitous and compelling reason," and you will be ineligible for benefits. 

However, if you were given the choice between immediate termination and voluntary RIF, and selected the RIF, you will be eligible for unemployment, provided that your termination was indeed imminent. If this option is presented to you, you should call an employment lawyer at once prior to accepting or rejecting the offer. The key here is that your termination must be imminent not, for example, something that will very likely occur a week, month or year down the road.

What is Better, Severance or Unemployment Benefits?

Of course, the main dilemma one faces is weighing the benefits of the severance and benefits offered in connection with the RIF against the value of the unemployment benefits you receive if you are terminated as part of a RIF (if you are RIFed, you will be entitled to unemployment benefits – assume your benefits will be the equivalent of roughly 10% of your earnings, with the maximum being $575 per week for at least 26 weeks).

Additional questions on Pennsylvania Unemployment Law? Click Here to go to our Post addressing FAQs on a wide variety of Pennsylvania unemployment law issues.

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