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Dec09

Reduction in Hours/Unemployment

Are pay reductions seen differently by the unemployment office than a reduction in hours even though the result is the same? (i.e. lower pay to the employee)? We are in Ohio.

Yes. An employee who was formerly working 40 hours per week and is now working 20 hours per week is seen as partially unemployed, and often entitled to partial unemployment benefits.

However, an employee who accepts a 50% reduction in salary  while working 40 hours per week is simply working full-time for a lower wage. The employee is not entitled to any unemployment benefits, in most cases. He or she has just accepted a new job (even if the duties are the same as the old job.) This employee is not unemployed and does not qualify for benefits.

In many states, an employee who quits rather than accept the lower wages qualifies for unemployment benefits. However, if the employee works for the lower wages, even one day, then the employee has accepted the new salary arrangements. An employee who quits after that point usually does not qualify for unemployment benefits.

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This entry was posted on Wednesday, December 9th, 2009 at 12:20 pm and is filed under
Compensation.
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