Adventures in why you should never do contract work while getting unemployment insurance

DH was offered the chance to do some contract work by some former colleagues who needed his skill-set to help with a grant proposal.  He would have done it for free as a favor, but they had money for it so they wanted to pay.  It also turned out to be more work than they initially said it would be.

Before he agreed, I was like, what will this do to your employment insurance?  And he said that he’d looked it up and they would prorate it and then give it back if he ran out of weeks (that is, he could stay on unemployment insurance a little longer up to the amount that he was prorated).  He would have to declare the weeks he actually worked, not when he sent in the invoice or when he actually got paid.  (He has not yet been paid.)

Turns out that they don’t ask for all of the information that they need on the form to declare contract work.  We found this out later.  Here’s how we got to that part:

So three weeks after he turned his stub in, I noticed he hadn’t been paid the week before like he should have been.  So he went on the online site and it said there was a problem with his unemployment insurance and they had stopped it and he needed to call some number.

So he called the number and it said leave your number to call back.  So he did.  Then he waited a few days and the weekend and a few days and nobody called back.  So he called again and was on hold for over an hour (maybe an hour and a half?) then that office sent him to another office and he was on hold for a while, but under an hour.  Then he got someone and was giving them his information and the other person’s phone went out (are they doing this from home? was it a cellphone?)  So DH was like, surely they will call me back (HAHAHAHA), but of course they did not!

So the next day DH looked up what to do on reddit, and they gave him the number for the place he’d been transferred to rather than the first place, so he would only have to be on hold for part of the time.  Except, that second number was overburdened so instead of being on hold, it would give a message that it was overburdened and to try again later.  Reddit says this is normal and to just keep trying.  So he did.  And eventually he got through, after maybe half an hour of continuously redialing.  Then they got his information, then got the information for the place he contracted from *which they could have requested online when he declared income,* but didn’t.  They didn’t even tell him they’d cut off his benefits.  He just … didn’t get them.  They have his email address and could have sent him something, but they didn’t.  They could have warned him this would happen when he submitted the form.

This is a hurdle.  This is not an accident.  They could fix it but have chosen not to.  Probably because they want people who can do contract work to give up on trying to get their unemployment benefits back and just to stay employed.  What it does instead, of course, is it keeps people from taking contract work because it’s just too much effort to declare (something I suspected when my sister’s boyfriend offered DH some contract work), and it causes people to get paid under the table or to just not report earnings.  (DH would never do that, but he would certainly do something for free instead of for pay because of the known effort cost!)  Since contract work often becomes full-time work, this could be costing people jobs.

This process is irritating to us and I was like, we need to pay someone to hit redial!  But imagine for people who actually need that money because they don’t have a high earning spouse.  How frustrating and terrifying.  And how many hours does it take away from actually looking for a job or getting education or taking care of kids etc.  Not to mention the time of the people answering the phones for something that could have been collected online when it was initially declared.

Stupid administrative burden.

Have you ever dealt with your state’s unemployment insurance system?  Did it work smoothly or did you have any problems?

10 Responses to “Adventures in why you should never do contract work while getting unemployment insurance”

  1. CG Says:

    I have only dealt with my state’s UIA as a household employer, and it has consistently been a pain. Have a question or problem and need to talk to a human? Good luck! I can only imagine how frustrating it must be from the employee perspective. I have had a similar thought as you, that they make it so hard to do the right thing, no wonder so many people cheat the system and pay for child care under the table. I want to preserve my ability to run for president someday (haha), so we are very strictly by the book, but it is not a user friendly system.

  2. Debbie M Says:

    My boyfriend was in a similar position, unemployed, but getting a bunch of short-term jobs. He has, indeed been able to report the hours and get unemployment compensation for the weeks he didn’t work. I’ve only really heard him complaining about how if he forgets to make his report on Sunday, it’s crazy to try to get it done.

    I’m sorry your system is even suckier than ours!

  3. SP Says:

    This is really infuriating.

  4. delagar Says:

    Dr. Skull filed for unemployment when the pandemic hit, last March — we didn’t get a single check until May 5, after had gone down, in person (during the pandemic!) at five in the morning and waited in line with hundreds of other people at the unemployment office until it opened at nine, not once, but three times.

    Calling and using the website was useless. Only showing up and sitting across the desk from a harried civil servant did any good at all. What did the civil servant do? Open and file and check approved, apparently. Madness.

  5. omdg Says:

    Even during non-Covid times, getting unemployment was a bitch. The whole system is set up to avoid paying you, and yes, this is on purpose and disenfranchises the people who need the money the most. See also: disability. The fundamental problem is that we worry excessively about a few people taking advantage, such that we design expensive and cumbersome systems to prevent that, which ends up hurting everyone else. I know you know all this, but it is still incredibly frustrating.

    • nicoleandmaggie Says:

      Yup, all the focus on moral hazard and zero focus on the needy not getting what they need. When I teach about Type 1 and Type 2 error it all seems so obvious to students, but without it in front of them they only focus on one or the other. (Usually the moral hazard part given where I live and what my degree is in… but public finance economists understand both!)

  6. revanche @ a gai shan life Says:

    I could scream for about a week about how much time I wasted during my maternity leave fighting with the POS system for unemployment and they make it absolutely impossible to reach anyone even when they tell you to contact them and even after several hours of figuring out about six messes they caused by not reading their mail and not fixing anything in the system when they had the information, there is still one mess to fix and frankly I don’t have the energy to care. They kept pestering me for information on a two week payment that they claimed was an overpayment even though they had all the information to justify the payment. And now they’re pestering me about something else. I’m just kind of ignoring it for now because if they bothered to get around to reading the information I sent them, they could fix it. This is what they spend their time on instead of preventing actual fraud. 🙄


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