A couple of weeks ago the LA Times ran a guide for unemployment benefits in its business section (which is available here). To offer such guidance is a great idea. Every news publication that wants to be useful to its readership should be so helpful in these days of soaring unemployment.
Unfortunately, the piece was written by someone who obviously has not been unemployed or filed for benefits at any point in recent years, and clearly was written on the basis of interviewing people at the state office, who simply aren't going to reveal some of the tricky aspects of unemployment.
So it's a bit like getting dating advice from a Catholic priest. Just misses the boat sometimes.
A big example: the LA Times guide doesn't touch on how to file for benefits if you were previously employed full-time, and now are working part-time, on a free-lance basis.
This is not a small number of people, I dare say, especially as we are being told on a nearly weekly basis how businesses are shedding workers so as not to have to carry their benefits. This is exactly what happened to yours truly. Laid off from a full-time job with benefits with a big media corporation and hired on a part-time basis to work a job with no benefits for another big media corporation.
So: How does such a person working part-time continue to receive benefits from unemployment?
Simple. First, don't try to game the state of California. You paid into the system when you were working full-time, you have a right to a certain level of support, depending on your past income, for a certain amount of time, which can be considerable. (A year or even more, if Congress approves.) Don't cheat. You don't need to, and if you do, they will figure it out eventually and punish you. Who wants that?
Second, keep in mind that the system is divided into two completely separate parts. Part one is the computer system. If you jump through all the hoops, according to the automated mail/computer/state records system, you will get your benefits with remarkable speed and accuracy. But make the slightest miscalculation or confuse the automated system in any way, and your file will be kicked up to the human level, which can correct mistakes, but is also completely overwhelmed and slow as mud.
Okay, so how does this relate to a free-lancer still eligible for benefits?
Here's the trick, as related to me over the weekend from a very nice lady at EDD. If you are a free-lancer, and you earn some money, when you earn that money, file the number accurately on the claims form and keep a record of the check, but DO NOT PUT DOWN THE NAME OF YOUR EMPLOYER OR THEIR ADDRESS. SIMPLY WRITE "SELF" or "SELF-EMPLOYED" and leave it at that.
Why? Because if you list your employer, the system is programmed to think you are working a conventional full-time job. They will then have to notify the human side of EDD, who will have to talk first to you the beneficiary. That will take weeks — three weeks w/o benefits in my case. In fact, the system is delighted to hear that you the beneficiary are working, even part-time, and only wants to be certain that your part-time free-lance work does not interfere with your search for a full-time job comparable to your previous work…even if that job is likely gone for good.
Got that? Email me if you have any questions. As the EDD lady said about this little trick for part-timers who once worked full-time…"there's no way you could have known that."
Believe me, it's not in their guidebook…nor in the newspaper.
Kit Stolz 
This was a great post, thanks.
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Thank you so much for this post. I do have a question.
I’ve not worked a full-time job in about 3 years. I’ve been freelancing with the same client for that time – working anywhere from 16 hours a week to 40 hours a week. My work with them finally ended in December ’08 and I have not worked for anyone since then.
In the example you provided, I couldn’t figure out (since I wasn’t laid off) if I’d still be eligible for unemployment benefits when I file a claim. In my case, would a freelancer such as myself be eligible for benefits?
Thanks,
Angelo
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Dear Angelo…my sympathies…my suspicion is that you have to be officially hired full-time and then laid off to get unemployment. Probably ten or fifteen years ago you would have been hired full-time, but in our predatory stage of capitalism, it apparently makes more sense for businesses to treat us like tissues to be discarded when used, as opposed to living humans, who can evolve and grow wiser and more useful over time. But if your pay stub shows deductions for payroll taxes, social security, etc., I might be wrong.
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Thanks for the advice. Do you think this is what I should do if I was full time teaching and now will take on a few substitute teaching jobs?
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Yes, I think so. The unemployment form will ask your hours and why you stopped working. Write down your hours, and write down "self employed," but don't put down the employer, the address, why you stopped working, etc. That only applies, I have learned, to those who are working full-time jobs. If you're working part-time, scratching up work from whomever, you shouldn't put it down, because then EED will think that maybe you won't need unemployment anymore. And of course, the more work you find part-time, the longer your benefits will last, because they will deduct a percentage of what you earn from the unemployment checks.
It's worked for me. I'm still getting unemployment, and will do so for another couple of months (depending on how much part-time work I find). It's been helpful, and I haven't cheated anyone, nor do I intend to.
Best of luck…hope this helps.
yours truly,Kit Stolz
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THANKS SO Much for this I have been searching and searching for this info.
what did you put down under “reason no longer working?” – “gig ended?”
thanks
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oops… just reread your post and realized you addressed this… sorry!
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I just became unemployed from a full time job. I might be able to find work but as a 1099 which is “self employed” in California. So, does this mean that I can put exactly this? Will this affect my benefits at all? Will it reduce it to the point that the contract job is useless as I will just reduce my benefits by how much I earn? Will the earnings for the self employment affect my benefits at all?
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Sorry to hear about the unemployment, but I’m glad it was from a full-time job…that means you will get benefits, as long as you worked the required number of weeks.
If you are working part-time, without benefits, as self-employed, yes, you can use that designation on the form. It will reduce your unemployment benefits in the short term (most of your earnings you report will be deducted from your weekly benefits) but it will help you in the long term, because you will be drawing from the benefits you have earned working full-time, and they will still be available to you for a year. That is, let’s say your weekly benefit is $400…if you earn $200 working part time for the week, about $175 will be withdrawn from your weekly benefit, but you’ll still receive $225, and you will still be eligible for the remainder as the year goes on, until your total benefit (which will be told to you at the start, when you are granted unemployment) is drawn completely down.
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Hi, I’m self employed (own retail store but i’m going out of business due to acute economy) Can i get Ui benefits?
Thanks
JR
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Was just laid off from full time of many years. I have a couple of clients I was seen on the side, which I’m keeping as now I’m going to try and find more clients and develop that into full time self employment. That will take some time, though. Meanwhile I won’t be able to make it on just a few clients. Will I lose my benefits if I report this business intention?
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Hi Jules:
Don’t report the intention. For one, EED doesn’t care about intentions.
EED has two big questions in mind: first, are you working? Second, are you developing a new career? If they think you’re developing a new career, outside your past field of employment, then their attitude is that they don’t owe you unemployment, because you’re changing — you’re not looking where you looked before, and of course, anyone starting out in a new field is going to have it rough. (I’m translating roughly.)
If you want to extend your unemployment benefits and play by the rules, put down that you’re self-employed, and when you make some money, put down the amount you made, the hours you worked, and then in the last space simply say “Job ended.” It’s really the truth: that’s the way free-lance works.
After all, some of those clients may come back to you with more work, but there’s no guarantee, no benefits, and you’re not working on a continuous basis, so it’s really the truth.
EED will not penalize you for working intermittently like this, and the combination of part-time work and part-time benefits will help you, as you say, develop this work into full-time self-employment. We all wish you the best!
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I found the following page on the California EDD site very useful. It has a few court rulings on the matter.
http://www.edd.ca.gov/UIBDG/Total_and_Partial_Unemployment_TPU_41505.htm
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Thank goodness for your curious, smart, and sharing person. Nothing like this is posted anywhere! Kudos!
**background: Recent layoff, opportunity for a few hrs of work… but hesitant to accept if that would implicate forfeit UI benefits since it was not guarantee of FT job offer.
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Hi Kit-
Can really use your input on this…i’m a freelancer and followed as you have stated on applying for EDD. In a letter I got back from EDD recently, it stated “In order to qualify to received unemployment insurance you must have been an employee during the year 2010. Unemployment insurance is an employer contribution, therefore if you were self employed you unfortunately do not qualify for benefits.”
Any feedback would be greatly appreciated.
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Hi Topher…well, people who are laid off from conventional jobs and then go to work on a self-employed basis can get unemployment, and they should, but they have to have first worked a conventional job, in which their past employer paid into the EDD system.
That’s what they’re telling you. I wish I had better news, for myself as well as you.
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Thanks for the feedback Kit.
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Hi Kit.
I was currently receiving unemployment benefits. I picked up a freelance job in the same field. It just doesn’t pay what I used to make working full time. The thing is, I mailed back my continued claim form and put my current employer in the work section. I know I should have put self employed. Eeekkk, what should I do at this point to still receive my benefits while working part time? Now EDD think I’m trying to get benefits from my new employer, not my previous one. Any advice would be helpful. Thanks
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Hi Laurie…that mistake could be a problem, I fear, because although EDD doesn’t really make much of an effort to check claims statements against the reality in the world outside, it does have a very sharp eye for self-contradictions.
I see three options: first, to throw yourself on the mercy of EDD. Call them up, explain your error, and humbly ask to refile for that week. Second, to pretend it never happened, and hope they don’t notice. And third, to find a
friend/attorney and ask him or her to intervene, not so much for the week in question, but for the sake of future benefits, which can add up to a substantial amount over the course of a potential 99 weeks.
My experiences with EDD on the phone have been mixed, but not all bad. My worry is that sometimes freelance jobs can almost be like regular work, but low-paid and without benefits, even if they consistently come from one employer to one employee. If there is ambiguity on that point, it could be a problem, because it might look to them like a regular job that you are keeping secret, so as to continue receiving benefits. If I were in your shoes, and this job was just one of many freelance jobs, and you can show that, I would take the plunge into EDD-land.
If you let it go unremarked, and they catch you, in my experience you should be ready to pay back the benefits you received, if that is the remedy they ask. I made a different kind of mistake, was penalized, paid my penalty, and that was that. But in this situation it sounds as if it’s the future benefits that would be imperiled.
I haven’t had to consult an attorney over an EDD issue, thankfully, but if you know of some friends who work in the law, I would ask around to see if you could find some help. This is an innocent mistake, and may not (I hope!) become a problem, but if it does become a problem, I suspect having the law in your corner could make a big difference, and I bet a decent attorney would not charge you an arm or a leg to make a call or two or write a letter.
I wish the best of luck.
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Hi Kip,
I’m so glad I ran across this post because this is exactly the issue Im struggling with. In July I quit my F/T job that I was employed with for 4 1/2 years. I was then hired on a “freelance basis” by another very large corporation that has been paying me via a 3rd party payroll company. I am paying taxes on each check I receive from them which is approximately 12-20 hrs/week but Im listed as Non-Union freelance.
Here’s where my confusion comes in; The company I recently quit has asked me to come back for the next 3 weeks while they prepare to go out of business. So, I believe Im listed as either a P/T employee or a F/T employee (working than 40 hrs) in either case Im wondering if when they do finally lay me off will I be eligible for unemployment regardless of working an average of 12-20 hrs of freelance work for this other company? Also, if I were to leave my freelance position will that make me ineligible or more eligible? Any thoughts would be greatly appreciated! You are very generous to offer all of your advice and personal experience.
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HI, I know this is an old line, but I was wondering if you could clarify working 1099 while on CA EDD unemployment. I filed for benefits and then I worked one week doing contract design work. I know I need to tell EDD on the paper form.
I read you said to put down “Self-employed” and then list the hours and total money. Is this still true? Also, what do I put down for why no longer working? Do I leave it blank or put “Job Ended”.
Also, will my benefits be affected beyond the week I did the work? I recently read the rules and it seems like 1099 work isn’t penalized since it isn’t considered full employment. Should I be worried?
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self employed for some time but this year was hired and worked for 3months for a company before they decided to close shop. Even while i was working for them full time i was still doing a few 1099 gigs on the side as well. Do u lump all contract work into one entry on form? Please advise how to proceed and what to expect.
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Hi DD,
To be eligible for unemployment benefits, you have to work a certain number of weeks at a old-fashioned (non-1099) job. I can’t remember how many weeks that is. (It’s been years since I’ve been eligible myself.) But let’s assume you are eligible. In that case, no, don’t list all your 1099 side jobs together, because that might confuse the system. They might think you were working a salaried position, but trying to hide something, such as benefits. EDD actually wants to pay you all the benefits you deserve, but literally cannot stand it when people hide income and take unemployment benefits they do not deserve. So even if all the side jobs seem piddly and not worth the trouble to list separately, you’ll be better off painstakingly putting them down one by one. Best wishes — Kit
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Hi Kit,
I was working for an accounting firm for 4 years ending in June 2014. I left to start an internet marketing business with a buddy of mine so I could be closer to my family. We were making money for the first couple of months and then cash flows were cut off due to a Google algorithm update in September. I am wondering if I qualify for unemployment benefits? I have paid unemployment taxes for 4 years, but I did quit my job. Thoughts on how to phrase this in the application? I would really appreciate your help.
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