# Can a lump sum settlement delay unemployment benefits?

## Can a lump sum settlement delay unemployment benefits?

Typically, an employee receiving a lump sum payment under a separation or settlement agreement must wait for a period of time to receive unemployment compensation. However, a recent Minnesota Court of Appeals ruling means that in certain instances, separation pay will no longer delay a claim for unemployment benefits.

How is a lump sum for unemployment calculated?

The commission arrives at this figure by taking the number of weeks you could collect a full benefit check on regular unemployment — usually 26 weeks — and multiplying that by your weekly benefit. This figure may look like an attractive lump sum, but it’s only a prediction of the benefits you may receive, not the benefits you will receive.

### How to calculate a workers’comp lump sum settlement?

Take the number of weeks left on your claim, and multiply it by your weekly benefit. For example, if you are on s. 34 (total) benefits, and your weekly check is for \$500, and you’ve already been on benefits for a year, you’ve got 2 years – 104 weeks – of s. 34 benefits left. 104 x 500 = \$52,000.

How does the judge look at a lump sum settlement?

Your attorney will tell your story and explain why the lump sum is in your best interest. The insurer’s attorney will be asked if he wants to add anything. The judge will then look over the paperwork, and will ask you a few questions. The judge wears a different hat here than you have seen in the past.

Typically, an employee receiving a lump sum payment under a separation or settlement agreement must wait for a period of time to receive unemployment compensation. However, a recent Minnesota Court of Appeals ruling means that in certain instances, separation pay will no longer delay a claim for unemployment benefits.

## Can you collect unemployment if you get a lump sum?

With a lump sum payment, you may be entitled to unemployment benefits after you’ve received that money. Severance that’s paid in installments, however, could compromise your ability to collect those benefits since you’re still receiving a steady stream of income.

Can a lump sum settlement be done out of court?

This settlement is done out of court and is a contract between you, the insurer, and sometimes your employer. It’s important to realize that you give up certain rights by accepting a lump-sum settlement so it’s best to speak with an attorney to go over your options.

### How does a lawsuit affect your unemployment benefits?

This reported income may reduce your unemployment payments or disqualify you from getting any benefits. However, not all money received counts against your unemployment claim. The money must be earned as a wage for services performed by you for an employer.