My employee has been on furlough and collecting unemployment insurance (UI). If I bring her back to work part time, what is the maximum number of hours she can work before she loses her UI benefits?
Rather than looking at the number of hours worked, California adjusts UI benefits based on what the employee’s earnings are when she returns to partial work.
When an employee is receiving UI benefits and then begins to work some limited hours again, she must report her earnings every two weeks to the Employment Development Department (EDD).
Depending on how much is earned each week, EDD will use one of two formulas to determine if the employee is still entitled to collect some portion of her weekly UI benefit amount.
Note that the calculation is based only on the UI benefit provided by the state of California. Any federal supplement—such as the additional $600 that was provided under the federal Coronavirus Aid, Relief, and Economic Security (CARES) Act or the $300 additional federal benefit that will take its place—is not taken into account.
Formula 1
Weekly Earnings of $101 or More
If the employee’s weekly earnings when she returns to work are $101 or more, the first 25% does not count against UI benefits. The remaining 75% is subtracted from the previous full weekly benefit amount, and the employee is paid the difference.
Take for example an employee whose weekly California UI benefit when completely unemployed was $315. That employee returns to work part-time and earns $200 in a particular week. EDD subtracts 25% ($50) from the $200 earnings. The remaining $150 is subtracted from the previous $315 benefit amount, meaning the employee would receive $165 in UI benefits that week.
Formula 2
Weekly Earnings of $100 or Less
If the employee’s weekly earnings when she returns to work are $100 or less, the first $25 does not count against UI benefits. The remaining amount is subtracted from the full weekly benefit amount, and the employee is paid the difference.
So for example, an employee whose weekly California UI benefit when completely unemployed was $290 returns to work part-time and earns $80 in a particular week. EDD subtracts $25 from those earnings. The remaining $55 is subtracted from the previous $290 benefit amount, meaning the employee would receive $235 in UI benefits that week.
Column based on questions asked by callers on the Labor Law Helpline, a service to California Chamber of Commerce preferred and executive members. For expert explanations of labor laws and Cal/OSHA regulations, not legal counsel for specific situations, call (800) 348-2262 or submit your question at www.hrcalifornia.com.
