California Employment Law
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Good afternoon and thank you for entrusting me to answer your question. I am very sorry to hear about this reduction in hours and the difficulty you now have making ends meet.Generally speaking, a claimant must prove that they are unemployed "through no fault of their own" in order to receive unemployment benefits. Where a claimant quits their job, they must demonstrate that their resignation was with "good cause" or else the EDD will reason that they are unemployed "through fault" (since they voluntarily chose to leave their work) and deny the claim.An employee will be found to have quit with "good cause" if they can demonstrate a substantial cut in their pay. To this end, the EDD states as follows in their Benefits Determination Guide:"An employer is often forced to reduce wages for economic reasons. However, the fact that the employer's declining business necessitated reducing employee wages, does not impose a duty upon the employee to accept the reduction. In cases involving wage reductions, good cause is measured by the reasonableness of the claimant's actions in relation to the circumstances existing at the time of quitting.Title 22, Section 1256-22(b), Comments provides:. . .factors other than a pay reduction influence an individual's decision to leave the work, all such factors are evaluated to determine whether a reasonable person genuinely desirous of retaining employment would have left the work. . . . However, a pay decrease of 20% or more, taken alone, is a substantial reduction in pay to establish good cause for leaving work where the employee is notified of a transfer or demotion to another position with the employer. Pay includes the basic wage, shift differentials, board and room furnished by the employer and guaranteed overtime. Pay also includes fringe benefits such as vacation pay and insurance if such fringe benefits are currently available or set schedules and information to value fringe benefits for the former and other position are available."As noted above, reductions in pay of more than 20% are a "substantial reduction in pay to establish good cause." Since you indicate that your pay is being reduced by more than that percent due to your reduction in hours, quitting would ordinarily be with "good cause" under the circumstances you describe, and so even if you quit an individual in your circumstance would likely remain eligible for unemployment.As a caveat, each claim for unemployment benefits is judged on its unique facts. There are few hardline rules here, and while the law would support a claim for unemployment benefits under the circumstances, you will always be assuming some risk that your claim will be denied since the presumption when an individual quits is that they are unemployed "through fault."Please do not hesitate to let me know if you have any questions or concerns regarding the above and I will be more than happy to assist you further.If you do not require any further assistance, please be so kind as to provide a positive rating of my service so that I may receive credit for assisting you. Very best wishes to you and thank you so much for coming to Just Answer.
Thank you for the response! Per my closing question: is there anything I should go in order to gather information should I resign and the employer contest the issue? If it were to go to contention, I would ideally want to avoid a "he said, she said" argument. Any insight about what sorts of documentation or items I should obtain before making a decision of resignation?