Temporary Layoffs: Entitled to Unemployment?

A handful of auto plants have closed in Japan, waiting to be repaired from tsunami damage.

Because the U.S. auto industry is so tied to Japanese production plants, the electronic part shortage is expected to cause Toyota, Nissan and even General Motors to temporarily close about a dozen U.S. auto plants.

Employees are expected to be temporarily laid off until the Japanese auto plant closures are reversed. Even though they may be rehired in a few months, the employees could be entitled to unemployment benefits.

Unemployment benefits are part of state-run programs, meaning that eligibility for a temporary layoff, such as with the auto plant closures, is state-dependent.

Some states make a distinction between a temporary layoff, while others just consider it to be long-term unemployment.

If a state has temporary layoff benefits, there is usually a maximum amount of time that a person can be laid off. It could be as little as six weeks, or as long as a few months. Either way, it requires a definite rehiring date.

If there is no definite rehiring date, or the state does not distinguish, a temporarily laid off employee is likely entitled to standard unemployment benefits subject to all applicable rules.

Most states are currently having issues meeting unemployment benefit demands, with long processing periods. Because the impending auto plant closures, and most temporary layoffs, tend to resolve themselves in a matter of a few months, it's possible that an application won't be processed until back at work.

If this is the case, it is still wise to apply for unemployment benefits, as benefits generally begin when an application is filed, entitling the victim of a temporary layoff to back payments.

Related Resources:

• Toyota and Honda extend plant closures in Japan (Detroit News)
• Unemployment Insurance: Overview (FindLaw)
• Eligibility for Unemployment Compensation Benefits (FindLaw)
• Unemployment Benefits Insurance: Are You Covered? (FindLaw's Law & Daily Life)