Pennsylvania workers who have their hours reduced by their employers due to the COVID-19 crisis may be able to collect Unemployment Compensation (“UC”) benefits. Similarly, workers who lose their jobs due to the crisis and pick up part-time work elsewhere may also be eligible for UC benefits. Whether these workers can collect UC benefits depends on how much they earn from that part time work based on something known as the Partial Benefit Credit.
Generally, Pennsylvania workers collect unemployment at what is known as the Weekly Benefit Rate (WBR). The WBR is calculated based upon the highest quarter of a worker’s gross earnings looking back at the worker’s “base year”. A worker’s WBR is typically about one-half (1/2) his full-time weekly earnings.
Under the Pennsylvania UC law, you can work part-time and earn up to 30 percent of your WBR in each claim week before your part-time earnings affect your UC weekly benefit payment. This 30 percent of your WBR is known as the Partial Benefit Credit (PBC).
In short, whether (and how much) the now-part-time worker will receive in UC benefits is determined by a formula using their PBC. Employees are required to report any pay they earn each week and that amount is then compared to their PBC. The following illustrations who how part time earnings would impact a worker’s weekly benefit:
1. If the worker’s gross earnings for a week are equal to or less than their PBC, the claimant’s full WBR is payable for the week.
Illustration: A worker’s regular full-time earnings are approximately $600 per week. The worker’s hours are reduced. When he applies for UC benefits, he is determined to have a WBR of $300 based upon his “base year” earnings. His PBC is $90 (30% of $300 = $90). Working the reduced hours, if the worker earns $90 or less the following week, he will receive the full $300 in benefits for that week.
2. If the worker’s gross earnings for a week exceed the PBC, the gross earnings are deducted from the sum of the WBR plus the PBC to determine the amount of any partial benefits for which the worker may be eligible.
Illustration: Same scenario. However, this time the worker earns $150 in a week working reduced hours. His benefits are calculated as follows: $300 (WBR) + $90 (PB Credit) = $390 – $150 (reduced weekly earnings) = $240 (partial benefit amount).
3. If the claimant’s gross earnings for a week are equal to or greater than the sum of his WBR plus the PB Credit, no benefits are payable for the week even though the claimant may have worked less than his full-time hours.
Illustration: Same scenario. However, this time the worker earns $400 in a week working reduced hours. $400 is greater than $390 [$300 (WBR) + $90 (PB Credit)]. Therefore, the worker does not receive unemployment benefits for that week. Note, under this scenario, the worker does not collect UC benefits even though he earned less than his regular full-time earnings, which were $600 per week before the reduction in hours.
For further information regarding part time benefits or for assistance navigating any legal issues presented by the Coronavirus (COVID-19) pandemic, please contact MacElree Harvey, Ltd.’s COVID-19 response team at [email protected]. Thank you.
