Unemployment Compensation (UC) Tax Services Unemployment Compensation (UC) protects workers who experience job loss by providing temporary income support to people who become unemployed through no fault of their own. UC Benefits are paid, for a limited time, to individuals who are able and available for suitable work and are actively seeking new employment. To qualify for UC benefits, a worker must have performed services covered under the Pennsylvania UC Law (Law), and must have worked for an employer who is required by Law or elects to pay into the UC Fund. Employer contributions (in the form of quarterly tax payments) are the primary funding source for UC benefit payments. An employee withholding tax is a secondary funding source. The costs of UC program administration are defrayed by federal employer taxes collected under the Federal Unemployment Tax Act (FUTA). Learn more about UC Tax Services.