Current through Register Vol. 51, No. 19, September 20, 2024
A. Definitions.
(1) Employee Benefits Package.
(a) "Employee benefits package" means any
cash or in-kind contribution which is made by an employer to or on behalf of an
employee or any dependent of an employee and which does not constitute wages
paid to the employee.
(b) "Employee
benefits package" includes but is not limited to an employer's contribution:
(i) To a health, medical, life, or disability
insurance plan;
(ii) To a pension
plan or retirement plan;
(iii) To a
deferred compensation plan;
(iv) To
an annuity plan;
(v) To a stock
option plan; or
(vi) For dependent
care assistance.
(2) "Severance pay" means the gross amount of
severance pay, dismissal pay, pay instead of notice of termination, wage
continuation, or other remuneration paid or payable to the claimant upon
separation from employment.
(3)
"Wage continuation" means any payment that consists of the same wage amount and
employee benefit package that is paid to an individual when services are no
longer being performed as was paid when services were being
performed.
B. Deductible
Severance Pay.
(1) Severance pay shall be
deducted from benefits when the individual's former position has not been
eliminated.
(2) Wage continuation
shall be deducted from benefits even when the individual's former position has
been eliminated.
(3) The Secretary
shall allocate severance pay that is paid in a lump sum or in increments to a
number of weeks following the date of separation, including the week during
which the claimant was separated from employment. The Secretary shall allocate
severance pay by:
(a) Calculating the entire
amount of severance pay;
(b)
Calculating the claimant's daily wage by dividing the claimant's last weekly
wage by seven;
(c) Calculating the
number of days to which the severance pay applies by dividing the total amount
of severance pay by the claimant's daily wage; and
(d) Applying the severance pay to the days
immediately following the claimant's last day of service.
(4) If severance pay allocated to a
particular week is less than the claimant's weekly benefit amount, the claimant
shall receive the difference.
C. Nondeductible Severance Pay. Severance pay
that is not wage continuation may not be deducted from benefits when the
claimant's former position is eliminated and that position will not be filled,
regardless of whether the claimant's former job duties are being performed by
others.
D. Partial Earnings.
Severance pay that is less than the claimant's weekly benefit amount may not be
deducted pursuant to Regulation .10F of this chapter as partial
earnings.
E. Severance Pay
Reportable and Taxable. Severance pay is reportable and taxable for the purpose
of the employer's contribution obligations under the Unemployment Insurance
Law.
