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Unemployment Benefits for Contract Employees

Can contract employees receive unemployment compensation if they are fired?

Individuals hired through a consulting firm to provide services for another company, often called contract employees, may be eligible for unemployment benefits. The contract consulting company, not the company that directly managed the individual, would be responsible for unemployment insurance.

Each state has its own eligibility criteria for unemployment benefits. In general, unemployment insurance provides unemployment benefits to workers who are unemployed through no fault of their own. Involuntary separation can be interpreted differently based on whether the employee was laid off, resigned, or was fired.

An employee who was laid off or part of a reduction in the workforce will be eligible for unemployment.

It’s commonly thought that an employee who resigned will not qualify for unemployment. However, a worker who resigned for good cause, meaning continuing employment would actually have been an increased hardship, may receive unemployment. For example, an employee who resigned to avoid continued harassment or unsafe work conditions would normally receive unemployment benefits. Conversely, an employee who resigned because he didn’t get a raise or wasn’t happy with the work his was doing would normally not receive benefits.

Any employee can file for unemployment benefits even ones who were terminated. A terminated employee may receive benefits if he was fired for minor or unintentional violations such as poor judgment or tardiness. Major misconduct such as harassment or stealing will generally render a worker ineligible for unemployment.

This entry was posted on Tuesday, September 15th, 2015 at 8:28 pm and is filed under
Benefits, Termination.
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