What The Hospitality Industry Needs To Know About Unemployment Insurance

By March 23, 2020Coronavirus
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What service industry workers need to know when they get laid off/fired.

One of the most looked over parts of jobs in the hospitality industry is that of the benefits offered, both by the government (local, state and/or federal) and company. In times like these, there is a lot of confusion of what is available to hospitality employees, particularly those employees that are tipped. We want to break down the most common benefit available to you and the ways to go about taking full advantage of your unemployment benefits immediately.

Unemployment Insurance

Unemployment Insurance (UI) is the benefit you are eligible to receive if you lose your job due to circumstances beyond your control, such as a layoff due to lack of business or termination without cause  (again, this may vary from state to state). Employers pay into an unemployment insurance “bank” every pay cycle, managed by the state. Unemployment benefits vary from state-to-state but normally pay out between 40-60% of your normal weekly paycheck.

One of the biggest misconceptions of unemployment insurance is that it’s unavailable to servers or bartenders, tipped employees. This is NOT the case, however this is one of the reasons it is so important to be reporting your tips every week. Unemployment insurance pay outs are based on your earned income, so in the case of a tipped employee, your minimum wage earned plus declared tips.
Most employers will declare employee’s credit card tips for them and leave it up to them to claim any earned credit card tips. Some employers leave it up to the employees to declare their tips on their own. If you haven’t been declaring tips, your unemployment insurance claim payout will be significantly lower than what it would be if you had been consistently declaring tips the entire time. I know this doesn’t
help you now, and it’s a tough lesson to learn with all that’s going on, but when things get back to normal (and they will), START DECLARING YOUR TIPS. If you have been, go back through your last few pay stubs and work out what your average hours are over the course of the last 4-6 weeks and $ per hour is, this will give you a rough idea of what to expect from your UI claim.

Even if you’re not sure if you qualify, apply. As long as you answer all the questions honestly and to the best of your knowledge, there’s no penalty for applying and not being accepted.

Apply online. This is the fastest and most effective way to get your claim done and in directly to who needs to review and approve it.

Use direct deposit!

Just like applying online, this will ensure you’ll get paid as soon as possible.

Don’t wait to apply!

Claims, on average, take 7-14 days to process, so the second you are laid off, get online and get it taken care of. We in the hospitality industry are the kings and queens of procrastination, and in this particular situation, it’ll really hurt your wallet to wait.

We’re always here to field any questions you may have during this really confusing and ever-changing time, so if you can’t find an answer to a question, e-mail us. We’ll absolutely work tirelessly to get an answer for you!

-Justin Ferland

Disclaimer: This article is intended to be informational only. Unemployment benefits can and will vary from state to state and the information it provides is not legal advice.

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