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MDLaw
MDLaw, Attorney
Category: Business Law
Satisfied Customers: 6135
Experience:  Experience in business law, contract law and related matters.
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I have a situation. I live in Maryland. Prior to March 2015

Customer Question

Hello- I have a situation. I live in Maryland. Prior to March 2015 I had been on regular paychecks with full deductions. Unfortunately, the company where I work went downhill and switched me to commissions which I have been on since. The business is closing and I want to file for unemployment but have no paystubs since March 2015. Since I paid into unemployment for years prior to 2015, can they refuse me pay?
Submitted: 1 year ago.
Category: Business Law
Expert:  MDLaw replied 1 year ago.

Hello and thank you for using the Just Answer website. I look forward to assisting you.

When you say that you were switched to commissions, were you still a W2 employee? Or, are you saying that you have not been paid at all by the company since March of 2015?

Customer: replied 1 year ago.
I have been paid as a commission collection person. I only got paid a percentage of what I collected and then filed taxes
Customer: replied 1 year ago.
I was a w2 employee prior to March 2015
Expert:  MDLaw replied 1 year ago.

It sounds like you are saying that you were converted to an independent contractor position. Unfortunately, only employees are eligible to receive unemployment since the employer pays into unemployment (not the employee). However, if you are an independent contractor that means that you are considered to have been self-employed for the past year and a half and self-employed individuals are not eligible to receive unemployment since they did not have an employer paying into unemployment.

Customer: replied 1 year ago.
what happens to the years I was in unemployment? GONE????? That does not seem right.
Expert:  MDLaw replied 1 year ago.

I'm not sure what you mean by the years you were in unemployment? Can you explain? Unemployment is not like Social Security. Social Security is something that you pay into and you are entitled to receive based on how much you have put in. Unemployment is not paid into by you. It is your employer that pays into it and if you need to collect unemployment, it is taken out of your employer's contributions and not from you.

Customer: replied 1 year ago.
I guess i mean that all the years my employer paid into it
Expert:  MDLaw replied 1 year ago.

Your employer's account only gets charged when an employee loses their job through no fault of their own. You actually could have collected unemployment when they terminated you as a W-2 employee depending on the circumstances of their conversion of you to IC status although if you accepted the independent contractor position, that would have negated your ability to collect. Unfortunately, this is what a lot of employers have been doing to avoid having to pay for benefits and taxes. I would suggest checking to see if you were correctly classified as an independent contractor. If you were still doing your exact same job, then they could be held liable and face penalties for incorrectly classifying you and you could sue them in court for any monies owed to you.

Here is an IRS document outlining the difference between an IC and employee:

https://www.irs.gov/businesses/small-businesses-self-employed/independent-contractor-self-employed-or-employee

Customer: replied 1 year ago.
I was not doing the same duties. I totally switched to commissions or would had nothing. My duties no longer existed.
Expert:  MDLaw replied 1 year ago.

You might still want to take a look at the link to see if they were, in fact, treating you as an employee. That would be the only shot you have of obtaining unemployment - proving that you were an employee and not an independent contractor.

Customer: replied 1 year ago.
Sorry. Are yo saying to check after March 2015 or BEFORE when I was on ADP and definitely on pay. I know they were paying towards unemployment. I have copies of my returns and stubs at that time. I concern is even if I am at a lower unemp[loyment rate now, can I not go back to when they had me as a W2 employee> Sorry. Just confused
Customer: replied 1 year ago.
Sorry. Are yo saying to check after March 2015 or BEFORE when I was on ADP and definitely on pay. I know they were paying towards unemployment. I have copies of my returns and stubs at that time. I concern is even if I am at a lower unemployment rate now, can I not go back to when they had me as a W2 employee> Sorry. Just confused
Expert:  MDLaw replied 1 year ago.

No, I said to review the link that I posted earlier - the IRS website link.

Yes, when you are an employee, they would have paid into unemployment but not when you were an independent contractor.

I apologize if there is any confusion. I will try to keep it more simple. If you are not a W-2 employee, you are not eligible for unemployment. Your only chance of obtaining unemployment would be to prove that your job duties and how you were treated made you an employee and NOT an Independent Contractor as defined by the IRS (in the link I sent you). Put in a different way, your only chance to get unemployment would be to prove that you were incorrectly classified.