Can You Get Unemployment for Reduced Pay?

Unemployment benefits help support workers who have been laid off while they search for new work. These benefits help them maintain an adequate lifestyle while they line up another job. Although unemployment benefits are mainly meant for those who have lost their jobs altogether, workers who have had a drastic cut in pay or hours sometimes qualify for partial unemployment.

Reduction of Hours

If your employer drastically reduced your hours, you may be able to get unemployment even though you are still working. Each state's laws are slightly different when it comes to reduced hours. Most states have some type of unemployment plan for "partially unemployed" workers -- workers who accepted a severe cut in hours and therefore are making far less money than they used to. These workers will not get their full unemployment benefits, but will get a partial benefit each week until they find new employment.

Disciplinary Action

Workers cannot get partial unemployment if their employers cut their hours in response to poor job performance or for other disciplinary reasons. For example, if a worker's hours were cut because he was always late or called in sick at the last minute too many times in a month, the worker cannot get partial unemployment due to the reduction in hours.

Work Search Requirement

If you receive unemployment due to reduction in hours, you must look for a new job each week unless your unemployment representative tells you that you are exempt from this requirement. The work search requirement obligates you to find a new job that gives you adequate hours and compensation to survive without unemployment. You will not continue to be eligible for unemployment if you reject a new job offer unless you have sufficient reason, such as the job paying less than your current job or being too far away to reasonably expect you to commute.

Quitting Your Job

If you quit your job because of a drastic reduction in pay for reasons not related to discipline, you may still qualify for unemployment. Although voluntarily quitting your job disqualifies you for unemployment, you can get unemployment after quitting if you had to quit because of poor working conditions, including drastic cut in pay or in hours, especially if the cuts were made in violation of your contract with your employer.