Q. After 36 years of continuous service, my employment was terminated on January 15, 2022. My severance pay was established to be paid in two lump sums. I received the first half on February 21 and the second installment will be in February 2023. Do I have to wait to apply for unemployment because I am waiting for the second severance pay? If I do, will I be entitled to unemployment after this period?
A. We are sorry to hear that your post has been removed.
Exactly how your allowance is categorized is important here.
New Jersey does not consider severance pay as income when calculating whether or not a person should be eligible to receive unemployment benefits, said Joseph Sarnecki, Certified Financial Planner with American Financial Services at Fairfield. .
But you need to make sure the payments are considered severance pay and not a continuation of employment with the company, he said.
“If payments are made through their payroll system, the state may consider you still on the company’s active payroll and delay your ability to receive benefits,” he said. “If this is considered a ‘continuation of salary’, you will have to wait until the payments have been made before collecting.”
If so, it may be worth having a conversation to see if your former employer can pay the second installment early, Sarnecki said.
“The best course of action may be to file your unemployment claim and follow up to discuss the details of your situation once it is processed,” he said.
Send your questions to [email protected].
Karin Price Mueller writes the Bamboos column for NJ Advance Media and is the founder of NJMoneyHelp.com. Follow NJMoneyHelp on Twitter @NJMoneyHelp. To find NJMoneyHelp on Facebook. Sign up for NJMoneyHelp.comit’s weekly e-newsletter.