Unemployment Compensation When You Quit Your Job

Can you collect unemployment benefits if you quit your job? In short, the answer depends on your reasons for quiting and the laws of your state. In all states, unemployment benefits are available only to employees who are out of work through no fault of their own. When it comes to quitting, you will meet this requirement only if you quit your job for good cause. Each state defines "good cause" differently, but in general, you will be eligible for benefits if you had a compelling job-related reason that left you no other choice than to quit. And, in some states, certain compelling personal reasons will also qualify as good cause.

Good Cause to Quit: Job-Related Reasons

In most states, you will have good cause if your job put your health at risk or subjected you to degrading or unsafe working conditions. In these situations, most states will recognize that instead of quitting, you were constructively discharged, meaning that you were forced to quit because of circumstances that any reasonable person would have found intolerable. For example, if you quit because you were facing constant sexual harassment or dangerous working conditions, you will probably still be eligible for unemployment. However, you must typically give your employer notice of the issue and an opportunity to correct it before quitting. In many states, you will also have good cause to quit if your employer refused to pay you for your work.

An employee who quits in lieu of being laid off will not lose his or her eligibility for unemployment benefits. For example, if your manager tells you to accept an “early retirement” package now, because you are slated for layoff in a few weeks, you will probably still be eligible for unemployment. Even though you left your job, your decision wasn’t truly voluntary.

Good Cause to Quit: Personal Reasons

Some states allow employees to collect unemployment if they quit their jobs for compelling personal reasons as well. However, the laws differ significantly from state to state. While the following are some common examples, you should check with your state’s unemployment agency before making any decisions: 

  • Relocation with a spouse. Some states allow employees to collect benefits if they quit their jobs to follow a spouse who must relocate for work or military service.
  • Medical reasons. An employee who quits work because of his or her own medical condition or to care for a seriously ill family member might still be eligible for unemployment. However, in some states, the employee's health condition must have been caused by the job.
  • Domestic violence. In many states, an employee who has to leave a job for reasons relating to domestic violence will still be eligible for benefits.
  • Another job. An employee who quits one job to take another may be eligible for unemployment if that job unexpectedly doesn't pan out. However, the new job must be fairly certain (for example, based on a firm offer of employment); you won’t be eligible for benefits if you quit your job to look for work.

Disqualifying Reasons 

There are many perfectly good reasons why you might decide to quit a job. However, most of them probably won't entitle you to unemployment benefits. For example, perhaps you’ve decided to try you hand at a different type of work. Maybe you’ve recognized that you’re in a dead-end position with no opportunities to move up the corporate ladder. Or, you might find your work unfulfilling, your coworkers annoying, or your commute too long. All of these reasons might be imminently sensible, but they are generally not considered “good cause” to quit a job. So, unless you have a compelling job-related or personal reason as described above, your best bet is to secure a new position before quitting your existing job. 

Next Steps

As you can see, your eligibility for unemployment after quitting a job depends on your state’s law. To find out how your state defines “good cause” to quit, contact your state unemployment insurance agency. You can find links and contact information for every state's unemployment agency at www.servicelocator.org/OWSLinks.asp, sponsored by the federal Department of Labor's Employment and Training Administration.

Swipe to view more