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How to restart unemployment benefits if your workplace shuts down again

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After months of statewide shutdowns and record-shattering numbers of Americans filing for unemployment, people across the country are now back at work. According to the latest jobs report, 4.8 million jobs were created in June, and the number of people on temporary layoff dropped by another 4.8 million.

But recent weeks of resumed economic activity correspond with an alarming rise in coronavirus cases, particularly in some of the most populous states including California, Florida and Texas. Such developments have led governors to walk back reopening plans and shut down businesses yet again.

With a global pandemic very much still a threat in the U.S., workers may wonder if they'll still be supported by unemployment benefits if they return to work, only to be furloughed or laid off again. Here's what to know about resuming your unemployment benefits.

You can stop and restart unemployment aid throughout your benefit year

When you first apply for unemployment, you become eligible to receive a certain amount of money based on how much you used to earn every week, averaged over the previous four quarters. On average, this amount will replace roughly half of your previous earnings or less, and exact calculations vary by state. In April 2020, state-provided unemployment averaged $333 per week nationwide but ranged from a low of $101 in Oklahoma to $531 in Massachusetts.

This dollar figure is the maximum of what you can receive in unemployment every week for a benefit year of 52 weeks.

The number of weeks you can collect unemployment within that 52-week period will depend on your state. State allowances range from a low of 12 weeks in Florida and North Carolina to a high of 28 weeks in Montana but are most commonly 26 weeks. You don't have to use your weeks of unemployment consecutively, but generally you do have to use them within a year of when you first qualified for benefits.

So, for example, let's say you live in a state that offers 26 weeks of unemployment. You qualify for aid and claim benefits for 13 weeks. Your employer reopens and you're rehired, so you stop collecting benefits while you're working full-time. Twenty-six weeks go by. If the business shuts down again after that period, you'll still have a remaining 13 weeks to collect unemployment before your benefit year expires.

This is how your unemployment period could break down in normal circumstances.

Under the CARES Act signed in March, however, you get an additional 13 weeks of unemployment on top of what your state offers.

If your total unemployment allowance is less than 39 weeks total when adding your state's benefit with the 13-week extension, you can make up the difference through the federal Pandemic Unemployment Assistance policy, which also grants a total of 39 weeks of unemployment aid to people previously ineligible for benefits, including self-employed, freelance and gig workers.

You must exhaust your state-provided benefits before you can apply for a federal extension of aid, and these federal enhancements to unemployment insurance are set to expire at the end of December 2020 unless Congress acts to extend them through another relief package. If you don't use up the full amount of federal aid before the end of the year, and relief isn't extended in any way, it does not roll over into 2021.

How to stop or restart your benefits

In order to receive your unemployment benefit, you must log into your state department of labor account and recertify your claim every week. You'll answer questions about how much time you worked or any wages you earned that week. If you earned $0, you'll receive your maximum unemployment benefit for that week.

If you're called back to work at the same schedule and rate from before your layoff, you should immediately let your state unemployment office know, says Michele Evermore, a senior policy analyst at the National Employment Law Project.

You must notify your state agency that you're earning wages on the first day you're back to work, not when you get your first paycheck. For example, if you're recalled to work on July 15 but won't be paid until July 31, you still must stop your unemployment benefit as of July 15.

"The No. 1 cause for overpayment is if people don't notify their unemployment agency right away when they go back to work," Evermore tells CNBC Make It. If you're overpaid in unemployment and don't return the funds, your eligibility to receive assistance will be delayed if you end up needing to get unemployment again if you lose work in the future. In some cases, you could also owe a penalty for not returning the money soon enough, Evermore adds.

Not that long ago, tens of millions of Americans spent weeks, if not months, to be approved for unemployment benefits due to a surge in applications to outdated and underfunded state systems. For those understandably wary of going through the process to stop their benefits when there's a likelihood of needing to recertify again, "the good news is the agency will already have your information on file and won't have to go through as lengthy of a determination process," Evermore says. "Turning benefits back on again is much simpler than getting them in the first place."

You may qualify for benefits even if you're back to work

If you're back to work but are earning much less than before your layoff because your hours or wages have been severely reduced, you may qualify for partial unemployment and should continue to recertify for benefits.

You can earn up to a certain amount of your unemployment benefit until your payment begins to decrease. You'll also get the federal boost of $600 per week through July 26.

States have their own way of calculating partial unemployment. In Texas, for example, you'll subtract whatever you earned working from 1.25 times your normal state-provided benefit. Pennsylvania allows you to earn 30% of your unemployment benefit before it deducts the rest of your earnings from your payment. New York pays partial benefits if you work less than four days in a week and earn $504 or less; unemployment pay drops by 25% for each day you work, regardless of how many hours you worked that day.

If you earn an amount of money that disqualifies you from unemployment, the bank of weeks you have remaining will essentially pause until the next time you qualify, so long as it happens within your benefit year.

What could happen in January 2021

On January 1, 2021, unless enhanced unemployment is extended in Congress's next relief bill, your maximum weeks of unemployment resets to what is provided in your state. With that said, many states enact an "extended benefit period" ranging from six to 20 additional weeks during times of high unemployment. Every state except South Dakota has already enacted an extension.

Let's take a look at someone who lives in California and began filing for benefits on July 1, which is 26 weeks into the year. They're able to claim 26 weeks of benefits provided by their state but will no longer be eligible to receive the federal 13-week extension after the end of 2020. California has decided to extend state-provided benefits by 20 weeks. That means this worker will still be able to receive unemployment benefits for 20 weeks at the start of the next calendar year.

Normally, if you're out of work for longer than a year, you must reapply for unemployment, and your benefit amount will be recalculated based on your earnings from the previous four quarters. Many Americans will likely have worked sporadically by the time they reapply for a new year or may not have enough earning history to be eligible anymore. Given this, Evermore says Congress may pass a law, as they did following the Great Recession, that allows someone to collect their original benefit amount beyond the 52-week mark.

So if you've been out of work since April 1, 2020 and qualify for a $500 weekly benefit you may be able to continue collecting that amount beyond April 1, 2021 instead of having to recalculate a lower amount of continued aid.

What you can do now to make sure you're set up to continue aid in the future

Spikes and dips in coronavirus cases could lead to multiple bouts of unemployment, and you may be wondering just how many weeks of benefits can tide you over in the months to come. Edgar Ndjatou, executive director of Workplace Fairness, says it's a good idea to get clear on what you have left in your unemployment bank before you actually need it again.

"If you've gone back to work and you don't believe you've exhausted your unemployment, but you're worried you'll be laid off or furloughed again, it's not a bad idea to contact your state unemployment insurance office to figure out how much you have left in terms of coverage," he tells CNBC Make It

Despite the surge in new unemployment claims leveling out, Ndjatou adds that many state offices are still experiencing record levels of activity and that applicants should expect long wait times by phone. "If there's an alternative way, whether by email or fax, to try to communicate with your state office, I'd recommend doing that," he says.

Finally, Evermore says one of the best things you can do to ensure timely payment of aid, should you need it in the future, is to keep track of your password to log into your state unemployment account. She says many people who go back to work may think they won't need to remember their password anymore. However, "passwords are incredibly hard to reset in the unemployment insurance world," she cautions. Outdated IT systems may cause delay if you're not able to track down a password reset link, and in some states, you may have to call your agency in order for them to mail you a password reset document.

"That could make it difficult to turn your benefits back on," Evermore says. "Never lose your password."

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