Generally, the answer is yes, you can usually qualify for unemployment compensation after getting discharged from active duty. The reason: The military pays unemployment insurance premiums on your behalf to the state of your home of record, via a program called Unemployment Compensation for Ex-Servicemembers, or UCX.
Unemployment compensation is designed to help protect workers and their families from economic disaster when one person loses their income, through no fault of their own. However, the military is unique in that UCX will still generally pay benefits even if you voluntarily decide not to re-enlist.
Unemployment compensation is managed at the state level, (and at the territorial level in Puerto Rico.) Each state has its own division of unemployment compensation, and is free to set its own rules and procedures. Specific application procedures and eligibility criteria vary substantially from state to state, but there are a few common eligibility factors all states have in common, which we will describe below.
The UCX program has an agent in each state that administers the program, integrating it with the specific rules of that jurisdiction, and also assisting military veterans who qualify.
Not everyone who leaves the military will qualify for unemployment compensation. To qualify for the program, you must meet the following criteria:
- You must have been honorably separated, or separated “under honorable conditions.”
- You must have completed the term of your enlistment contract (if enlisted), except when the following circumstances apply:
- Medical discharges
- Hardship or compassionate discharges
- Discharges because of parenthood/family care issues
- Inaptitude or personality disorders (provided you have served at least one year.
- You were on active duty for at least 90 days. (This provision makes the UCX program applicable to reserve-component Servicemembers activated for at least that long, and renders the usual exemptions for temporary or seasonal work inapplicable to former Servicemembers under the UCX program.)
In addition to the military-specific eligibility criteria, each state will have its own criteria, as well. Examples of common eligibility criteria include:
- Ability and availability. You must not be disabled and unable to work. You must also be available to work if someone calls you.
- Effort. You must be looking for work. Most jurisdictions will expect you to document your job search, and expect you to go on a minimum number of interviews or apply for a specific number of openings each week. Some may allow you to attend job hunt seminars for a time, if you don’t put in the effort, the state may deny your benefits for that week.
- Earnings. You must have earned a minimum amount of money in each quarter throughout the state’s wage base period. This is usually defined as the four or five calendar quarters preceding your unemployment claim. States generally define unemployment benefits as a percentage of your average earnings during the wage base period. This means if you had no earnings for a year prior to being mobilized, and you were on active duty for 90 days, the state may consider you not to have qualified, or to have qualified for a reduced benefit level.
When you are separated from active duty, have received your DD-214, and you have completed your terminal leave, you can apply for unemployment compensation by contacting the Department of Workforce Development or Department of Labor in your state. You can’t apply while on terminal leave, because you are still technically employed (though you may be able apply if you sell your leave).
To apply, you’ll need your Social Security card and Form DD-214, with your separation characterized as honorable or under honorable conditions. When you show up to apply for benefits, you will also need to have a resume or CV, as well, as most states have their own employment agencies working to help workers move off the unemployment rolls.
If you have trouble with this step, many states also offer workshops via their unemployment offices to help job seekers with skills like these, and may provide referrals to skill development workshops as well.
Life isn’t cushy on unemployment benefits. It will be tough indeed if you have a lot of bills, a car payment, credit card debt and no savings. Unemployment will only pay about half of what you were earning before. And some allowances won’t be covered. Also, if you worked on the side as an independent contractor while on active duty, those wages won’t be covered. Generally, only W-2 income from non-commission jobs, non-temporary and non-seasonal work will be covered.
The normal maximum number of weeks you can collect is 26, or half a year. However, some areas with high employment may offer an additional number of weeks.
Coordination with Other Income
This is a vital consideration for veterans who frequently receive income from other sources, such as GI Bill benefits, retirement pensions and disability compensation. Be aware that unemployment insurance insures against a loss of income. If you have other income coming in, or if you take distributions from a 401(k), IRA or your Thrift Savings Account, your state may subtract that income from your unemployment benefit. If you take out a lump sum, the state may prorate that lump sum across a number of weeks or months, dividing your lump sum distribution by your maximum weekly benefit, before you can qualify for benefits.