Can I Get Unemployment Benefits If I Quit My Job?

Can I Get Unemployment Benefits If I Quit My Job?
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Last updated: June 2009

The following questions were submitted to John Roska, an attorney/writer whose weekly newspaper column, "Q&A: The Law," runs in the St. Louis Post-Dispatch (Illinois Edition) and the Champaign News Gazette.  This article was published on June 3, 2009

Q:    My employer cut my hourly wage, so I quit.  When I applied for unemployment, I was denied for quitting.  Is there any way I can qualify for benefits?  I don’t think it’s fair to deny someone unemployment if they refuse an unacceptable pay cut.

A:    If you had “good cause” for quitting, you can still qualify for unemployment benefits.  A reduction in pay can be “good cause.”  It’ll depend on the particular facts of your case, and the size of the pay cut.  If you haven’t already, you should appeal the denial.

There are two main reasons for denying unemployment:  you quit, or were fired.  In those two situations, the state considers it be your fault that you’re unemployed.  Only involuntary unemployment—the kind you could or should have avoided—qualifies for benefits.

Formally, the two basic categories of ineligibility are called “voluntary leaving,” and “discharged for misconduct.”  They’re found at Sections 601 and 602 of the Unemployment Insurance Act.  (More specifically, at volume 820 of the Illinois Compiled Statutes, Sections 405/601 and 405/602.)

Section 601 says:  “An individual shall be ineligible for benefits for the week in which he has left work voluntarily without good cause attributable to the employing unit.” 

The last part (“good cause attributable to the employing unit”) is the main exception to the disqualification.  If it was your employer’s fault that you quit, you’re not disqualified—you’re eligible. 

One court case that tried to figure out if an employee had “good cause” for quitting said that some of the factors to consider are whether the employer alters “the terms, conditions, hours, or compensation” of employment.

Another case said that “a reduction in pay may constitute ‘good cause’ depending upon the surrounding circumstances.”  Therefore, if you appeal, be prepared to explain precisely how much your pay was going to be reduced. 

Yet another case said that if you go along with a pay cut for several months, and then quit, the pay cut is NOT good cause for quitting. 

A cut in your hourly wage is the clearest kind of reduced pay.  It’s trickier when your hours are reduced.  Some cases say that reduced hours, if they’re reasonable in light of general economic circumstances, are not good cause for quitting.

Also, a general dissatisfaction with pay is not good cause for quitting.  For example, if you quit because you didn’t get the raises you expected or wanted, don’t expect to be found eligible for unemployment.

The “voluntary leaving” law lists six other exceptions that could qualify someone for benefits, even if they quit.  For the benefit of others (since those exceptions don’t help you), they say someone has good cause to leave:  (1) for medical reasons; (2) for another job that doesn’t pan out or turns out to be “unsuitable;” (3) because of sexual harassment by another employee; (4) because you’re a domestic violence victim; (5) to follow a reassigned military spouse; and, (6) for union employees, for refusing to accept a transfer that would make someone else to lose their job.

Employers fight unemployment claims to try to keep their unemployment tax down.  The more former employees who draw unemployment, the higher the employer’s unemployment tax rate.

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