Layoff Questions

[ladymoreta]

For anyone who's dealt with layoffs... Just wanting some information about what to expect.

Concise Background - My company is broke, so they're doing layoffs. Since I was planning to quit when the baby was born, I volunteered. Thursday or Friday will be my last day. Understandably, I have a ton of questions!

- Is there anything they might try to get me to sign that would make me ineligible for unemployment benefits? What do I need to look out for when I go into the layoff meeting?

- Unemployment benefits are through my state, right? I found the website where I will apply once I am laid off. Is there anything I need to file on the federal level?

- Do the penalties apply to cashing my 401k if I'm laid off? It's not even close to $1000, so I'm not sure if it's better to roll it over into an IRA or something, or just cash it out.

- Any other advice or information that you wish you'd known before going into a layoff?

[MrsK]

I don't know a lot about this but make sure you have health insurance and make sure that they don't show you as a "quit" instead of a "fire" because you volunteered.

[poky]

I think the voluntary layoffs where I worked were still eligible for unemployment; the company policy was to confirm that you'd been laid off if/when the state/county asked, not make a point of explaining that you'd volunteered. Your company may do it differently, I'd just ask. AFAIK, there's nothing to do at the federal level; should all be by the state. They will want you to be actively looking and available for work, and if they're anything like Oregon, they'll require you to come to some meeting that lets you know about the resources available to you (I avoided this by taking advantage of the enrollment in a career counseling service my company gave us as part of our severance).

[Deebs]

If ur company is broke, hopefully they've been paying into unemploent. If so u should be okay. Check out COBRA - the fed is currently paying 2/3 of it but I don't know how u tap into that discount. Good luck - hopefully you'll really benefit from the timing.

[Deebs]

Also to get unemployment u have to demonstrate thAt you're actively seeking employment. Might want to think of a strategy for that.

Also to get unemployment u have to demonstrate thAt you're actively seeking employment. Might want to think of a strategy for that.

Yes, this is a good point. Waaaay back, I was laid off and the unemployment benefits are through the state. Might be worth a look on smartmoney.com or Kiplinger.com to see if there is anything you need to do on a federal level (I think there was some change to COBRA stuff?).

Also, I think you need to be "laid off" rather than resigning or fired (terminated for cause) to get benefits. I'd say since you volunteered, make sure they have you as being laid off rather resigning.

[SuzySunshine]

I was laid off last March so I'll answer what I can.

- Is there anything they might try to get me to sign that would make me ineligible for unemployment benefits? What do I need to look out for when I go into the layoff meeting? I did sign a document which basically said I had no claims against the company other then my severance package. It didn't affect my unemployment claim.

- Unemployment benefits are through my state, right? I found the website where I will apply once I am laid off. Is there anything I need to file on the federal level? You don't need to file anything other then the state forms. I can't remember if you said you were getting a severance package but that will count against your unemployment. For example if you get 8 weeks paid after your termination date you will not get unemployment benefits until after that 8 weeks.

- Do the penalties apply to cashing my 401k if I'm laid off? It's not even close to $1000, so I'm not sure if it's better to roll it over into an IRA or something, or just cash it out. You will still get penalized on your 401k, just roll it over - it will be easier unless you really need the money.

- Any other advice or information that you wish you'd known before going into a layoff? I don't know that there is anything in particular but whoever said you needed a job search plan was correct, you'll be asked where you're looking and things like that. In case you get audited I would just keep track of all jobs that you do apply for, however in this economy audits are few and far between but you never know when you're going to be the lucky one.

Good luck!

I forgot to answer about the 401(k) -- I rolled it over. It was pretty easy to do.

[ladymoreta]

Thanks for the advice everyone! I got the "call" yesterday afternoon, and they let me go then. Very much a relief, so I didn't have to go through the drama today or tomorrow.

So, I wasn't supposed to get a severence package, but they ended up giving me 2 weeks pay, along with my pay for today and tomorrow, which I thought was a very nice gesture. My paperwork shows that the layoff is effective tomorrow. So, does that mean that unemployment benefits start in two weeks, or after tomorrow? Sorry, not trying to "milk" the system or anything, but I just want to get my application in as soon as possible, and anything I can do makes me feel like I have more control over the situation...

ETA - I am planning to look for another job, but I am going to let them know that it will just be temporary, so I'm not sure if that's a good thing or a bad thing in this economy. It could help me get a job fast if they're looking for someone for a specific project that they don't have to pay benefits, but it could take awhile if they're not wanting to invest a lot of time into training someone for just a few months.

[SuzySunshine]

You can apply for the benefits (and should) the first day you are unemployed, so now. But they will ask you if you got a severance package and they won't start paying you until the 2 weeks are up. But starting the process now should ensure that you will get your first check in 2 weeks.

[ladymoreta]

Great! Thank you!!!

I was laid off last November, with an effective end date of 1/12 (they extended it it through my maternity leave) and I got 14 weeks severance. It was paid out in lump sum so I was able to collect benefits after waiting the required one week waiting period. I supposed if it was paid out over the 14 weeks I would not have been able to begin collecting, however with a lump sum, at least in the state of PA, I was able to start immediately.