New Rules Change Buyouts

A change in Idaho unemployment rules means workers may want to think twice about taking a early retirement package or buyout from their employer.

Last year, the Idaho Department of Employment allowed people who volunteered to be laid off in corporate downsizings to receive unemployment along with any severance package the company would have paid them.

As of January, the state has tighter restrictions. If workers volunteer to take an early retirement package, the state won’t pay them unemployment insurance.

The rule is the same even if a worker simply volunteers to be laid off when a company needs to cut staff. Even if those who volunteer receive no severance money, the state treats it as a “voluntary quit for personal reasons.” The worker gets no unemployment.

Workers can always appeal the employment department’s decisions to the state Industrial Commission. However, the new rules come from decisions that commission made with other appeals for unemployment insurance, said Dwight Johnson, department spokesman in Boise.

One exception for workers would be if they can prove that they personally would have been laid off if they didn’t take the voluntary package.

Those cases would be considered a “discharge” by the employment department, and the worker could get unemployment.

Occasionally when workers get laid off through no fault of their own, the company automatically pays some severance based upon experience. The department will evaluate each of those cases to see if those workers would also be eligible for unemployment.