Labor, Employment, Benefits & Immigration

As the Coronavirus (COVID-19) spreads, a growing number of employers are considering terminating or furloughing employees. This has raised a number of Maryland unemployment compensation questions that, although not specifically related to the COVID-19 pandemic, result from its effects on employees and employers alike. This article provides guidance on the most common COVID-19 related unemployment issues.

• Determining a claimant’s weekly benefit amount (WBA) in Maryland.
• A claimant’s WBA is approximately 54% of gross weekly wages up to a maximum of $430 per week.
• Effect of a reduction in an employee’s hours on the employee’s unemployment benefits. 
• A claimant that is not fully employed, but earning income, will have the income deducted from the WBA dollar-for-dollar for amounts earned over $50. If the earnings exceed the WBA, no benefit will be paid for that week.
• Effect of paying a bonus on WBA. 
• If an employer pays an employee the difference between the amount the employee was earning and the employee’s WBA, the bonus likely will affect the employee’s WBA. The following payments made to an employee may be deducted from an employee’s WBA:
• Severance payments are deductible and will be pro-rated over subsequent weeks based on the last weekly wage paid.
• Vacation or holiday payments are deducted if, on or before the last day of work, the employer provides a definite return to work (RTW) date. If no definite RTW date is provided to the employee, the payments are not deducted.
• Bonus pay – may reduce or eliminate WBA depending on the weeks to which the pay is attributed.

If your company needs further guidance about your employees’ eligibility for unemployment, please do not hesitate to contact us. 

This alert was written by Marc Sloane, a lawyer in the Labor, Employment, Benefits & Immigration practice group at Miles & Stockbridge.

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