In some states, experiencing a significant reduction of hours at your job counts as loss of work, which qualifies you for state unemployment benefits. One of the requirements for unemployment insurance benefits is that you report your income each week. Depending on the income earnings allowance for your state, you may not receive full benefits but you will receive partial payments. If you fail to report the income you receive on those reduced hours, you can be prosecuted for unemployment compensation fraud.
The definition of partially unemployed can vary depending on the state in which you live. In most cases, if you bring in less than you would make per week, you're considered at least partially unemployed. When you apply for benefits, the state will check with your employer to verify the amount of income you usually receive and the reason for your decreased hours. If your reduction came about as a result of something you did, you probably won't receive benefits.
Reporting Your Income
After your state's labor department approves you for benefits, it will give you a day to certify for benefits on either a weekly or biweekly basis. You have to call in or log into the website to answer questions that verify your eligibility for the next payment. One of the questions is whether you earned any income for the period in question. You must declare your gross income for that week. Remember that the state's department of labor doesn't care when you get paid for the work. It only wants to know about the money you earned before taxes or any other deductions.
Partial Benefit Payments
Each state has an income earnings allowance, which means you can earn that amount each week without affecting your weekly benefit amount. Each dollar after that allowance gets deducted from your normal benefit amount. You receive the rest as your payment for that week. The actual formula as well as the income earnings allowance can vary depending on the state in question. Contact your state's labor office for specific details that apply to you.
Failing to Report Your Income
If you don't report your income from the hours you're still working to the state labor office, you're committing unemployment compensation fraud. When the state finds out, it will make you repay any overpayment amount. In some state, you'll be banned from the unemployment program for anywhere from a few weeks to a year. You can also be prosecuted for unemployment fraud and receive jail time and fines.