Potential Reductions

3.2 Percent Benefit Reduction

The PA UC Law contains provisions that automatically adjust benefit payments when the balance in the Unemployment Compensation Trust Fund is low. Due to the decline of the balance of the Fund, benefit payments for compensable weeks of unemployment will be reduced by 3.2 percent beginning with the week ending Jan. 1, 2023. For the week ending Dec. 31, 2022, and prior weeks through Jan. 6, 2018, the benefit reduction percentage will remain at 2.4%. Benefit payments are being reduced currently and will continue to be reduced while the balance in the Unemployment Compensation Trust fund remains low. This reduction applies to UC regular benefits. PEUC, EB, PUA, TRA and DUA benefits will not be affected. Sections 301.8 and 404(e)(4)(ii) of the PA UC Law requires a reduction in weekly benefits when the UC Trust Fund balance drops to a certain level. Here is how it works:

• The amount of the benefit reduction, if not an even multiple of one dollar, will be rounded to the next higher whole dollar.
• The benefit reduction is applied to the regular weekly benefit amount as well as the dependent’s allowance.
• The percent reduction is applied to the amount payable after the deduction of earnings, vacation pay, holiday pay and pensions.
• The percent benefit reduction is applied to the amount payable before deductions for child support, federal tax withholding or overpayment offsets.
• Your account balance will be reduced by the weekly benefit amount payable prior to the benefit reduction.

These examples illustrate how the benefit reduction will affect your UC payments.

Example #1

Payable amount prior to the benefit reduction: $385
Calculating the benefit reduction: $385 x .024 = $9.24 (rounded up) = $10
Payable amount after the benefit reduction: $385 - $10 (benefit reduction) = $375

Example #2

Payable amount prior to the benefit reduction: $460 + $138 (partial benefit credit) = $598 - $279 (earnings) = $319 + $8 (dependent's allowance) = $327
Calculating the benefit reduction: $327 x .024 = $7.85 (rounded up) = $8
Payable amount after the benefit reduction: $327 - $8 (benefit reduction) = $319 - $47 (federal tax withheld) = $272

Support Withholding from UC

Support Orders: Support obligations will be deducted from UC benefits if the department receives an administrative or judicial attachment order. Any questions or concerns regarding the amount being deducted from your UC benefits should be directed to the Domestic Relations Section of the Court of Common Pleas that issued the attachment order. More information on support withholding from UC benefits is provided in the pamphlet UCP-24, Support Withholding from Unemployment Compensation, also available from the UC service center. If support is deducted from your UC, log onto www.childsupport.state.pa.us to access your payment information.

Earnings

Part-Time Earnings: You are not eligible to receive benefits for any week in which you are working full time. However, you may be eligible for benefits if (1) your regular hours of work are reduced because of lack of work, (2) you are separated from your job and have obtained other employment with fewer hours of work, or (3) you are separated from one job but continue to have part-time employment with another employer(s).

If you are working part time during a week and earn no more than your partial benefit credit, your earnings will not reduce your benefits for that week. If you earn more than your partial benefit credit, the amount of your earnings that exceed your partial benefit credit will reduce your benefits for that week on a dollar-for-dollar basis. If you earn more than the sum of your weekly benefit rate and your partial benefit credit, you are not eligible for benefits.

Holiday Pay and Vacation Pay: Holiday pay and vacation pay that exceed the partial benefit credit are deducted from UC benefits for the week in which the holiday or vacation occurs. However, vacation pay is not deducted if you are permanently or indefinitely separated from employment.

Pensions: Pension payments may be deductible if (1) the pension is paid from a plan contributed to or maintained by a base-year employer; and (2) your work during the base year increased the amount of, or affected your eligibility for, the pension.

If the employer alone contributed to the pension, 100 percent of the prorated, weekly amount of the pension is deductible. If you contributed in any amount to the pension, 50 percent of the prorated, weekly pension amount is deductible. Pensions are deductible from weekly benefits on a dollar-for-dollar basis. The partial benefit credit is not applicable. The following pension payments are NOT deductible:

• A lump-sum pension payment, if you did not have the option of receiving monthly or periodic payments.
• A lump-sum pension payment that is rolled over into an eligible retirement plan, such as an IRA, within 60 days of receipt of the payment. (If you roll over only a part of a lump-sum payment, that portion of the lump-sum that is not rolled over is deductible.)
• Social Security and Railroad Retirement pensions.

Back Wage Awards: If you receive a back wage award for a period of time when you received UC, the back wage award may affect your eligibility for the UC you received.

The information provided on this site does not constitute a determination of eligibility to receive unemployment compensation.