If you've been fired or laid off, there's state unemployment insurance to fall back on. If you're injured on the job, there's workers' compensation, or even private disability insurance if you have a policy. But what if you are one of the millions of Americans -- nearly one in five of us (18.6 percent) according to the latest Gallup numbers -- who are underemployed, defined as still drawing income from reduced hours or part-time work?
Depending on where you live, you may qualify for partial underemployment or work-share benefits, little-known state programs that can help bridge the gap between what you're making now and what you used to make.
So much for the myth that you have to be unemployed to receive unemployment benefits.
"That's not true," says Bruce Meyer, McCormick Foundation professor of public policy at The Harris School, University of Chicago. "In many states, you can get part of your unemployment benefits even if you're working part time at lower earnings than you used to receive at your old job."
All states provide some partial benefits for qualified unemployed workers who accept part-time employment while looking for their next full-time job. Many states also have underemployment provisions to assist full-time employees with reduced hours.
Work-share programs typically tap state unemployment reserves to cover the difference in take-home pay for employees whose hours are reduced by 10 percent to 40 percent, a move aimed to help employers and employees avoid layoffs.
Employers typically must apply for acceptance into a work-share program. States such as Colorado, which launched its work-share program in June, make the program affordable by cutting back the number of weeks that employees can draw partial benefits from the unemployment fund.
At least 20 states currently offer work-share underemployment insurance, including Arizona, Arkansas, California, Colorado, Connecticut, Delaware, Florida, Iowa, Kansas, Louisiana, Maryland, Massachusetts, Minnesota, Missouri, New York, Oregon, Rhode Island, Texas, Vermont and Washington state. Six other states, including Hawaii, Ohio, Oklahoma, New Hampshire, New Jersey and Pennsylvania, are considering work-share legislation.
"It's clear that you have a partial entitlement if your work history is full time and either your employer cuts you back substantially, say from five days a week to two, or you were laid off and accepted some kind of part-time work with a new employer," says George Wentworth, senior staff attorney and unemployment specialist with the National Employment Law Project, or NELP.
You apply for underemployment benefits the same way you file for unemployment, by contacting your state's Department of Labor. Along with your ID and Social Security number, be prepared to provide contact information for your most recent employer and the date of, and reason for, your termination.
Most states then examine your earnings for the first four of the past five quarters (your "base period") to determine your weekly benefit amount, or WBA. On average, states attempt to replace 50 percent of a worker's lost wages, but cap the weekly benefit at or near the state's average weekly wage, according to the U.S. Department of Labor.