Well I suppose I thought our jobs were untouchable despite the bad economy. In retrospect this is exactly why it is important to closely monitor your finances and have an emergency fund available in tough times. I found out this week that my boss is really struggling to find work for me and in the last few weeks, for himself as well. The work has been great for almost 2 years and it has given me the opportunity to see my little girl grow and change every day, as a stay at home, work at home mom.
But now I am faced with a decision. My boss met with me last week and shared the bad news. He gave me three options:
- I can continue to be on his payroll without the current guarantee of 20 hrs/wk. This could mean that although he may be able to give me up to 20 hrs, in the current economy 0/wk may be more likely for the foreseeable future.
- I can become a contract employee. If he has work and I need/want to work, I can. If not, there are no worries or obligations for either of us. This will also mean a higher hourly rate due to the fact that he won’t have to pay payroll taxes. It also means that I can look elsewhere for other contract work.
- The third option is to be laid off and collect unemployment benefits.
So I took a look at how the unemployment benefits would break down for me. I’m in a unique situation in that I make a good hourly rate, despite only working 20 hrs/wk, but still wasn’t sure what that would mean for me since I only work part time. As MITBeta has said in the past, we can meet all our financial obligations on his income, but without some contribution from me, it is difficult to save and pay down debt aggressively.
Here is what I came up with in regards to our State’s unemployment insurance benefits. I am assuming I made $40/hr for the last quarter and $35/hr in the previous three quarters. You basically earn up to 50% of your weekly rate up to the maximum benefit of $628/wk. They take your highest two quarters over the last year to figure out the weekly rate. Using my hourly rate of both $35/hr (this was while I was receiving health benefits) and $40/hr (after we switched to MITBeta’s health plan), I came up with about $750/wk. You are eligible for 30 times that amount as your benefit credit or about $11,250 in my case. Assuming 50% of that weekly rate to be $375/wk that comes out to 30 weeks of benefits.
I think I am also eligible for an additional $25 for our daughter. So the total benefit would be around $400/wk or around $340 if we had state and federal taxes taken out.
They allow you to work up to a 1/3 of your benefit rate. So for me that would be around $125/wk. I am in the process of talking with my former employer about working for them as a contract employee. They may or may not be able to give me anywhere from 5-20 hrs/wk. If I could get an hourly rate of $40/hr from them I would only be able to work 2-3 hrs before I became ineligible for benefits. You can get partial benefits, but obviously at this point we’d need to weigh the cost of my time to keep up with the job search requirements of unemployment insurance. Given the fact that I am 7 months pregnant I am not really looking for a full time commitment, but just a chance to try working for another company from home to see how it would work. If it works well it would allow me some flexibility after the baby is born and give me more options in a downturn economy. Although both companies are in construction, the sectors they service are vastly different and are affected by the economy in different ways.
What do you think? Have you been laid off and have you filed for unemployment benefits? Are you an employer that has had to lay off an employee? Let us know about your experience in the Comments Section.