Lost Your Job and Offered Severance? 

Know Before You File for Unemployment

Losing your job isn’t just about the paycheck. It changes your routine, your confidence, and your sense of control. 

Whether you worked at a startup in Flatiron or a corporate tower near Wall Street, the moment that severance agreement lands on your desk, new questions start piling up. 

Can you still file for unemployment if you accept it? Will the timing of the payment change when benefits begin? And what if your employer’s explanation doesn’t match yours?

Our business transaction lawyers at Horn Wright, LLP, help New Yorkers answer these questions with clarity and strategy. 

We understand the ins and outs of unemployment law in New York, and we work with employees at all levels to ensure they understand how severance and unemployment benefits intersect, before important opportunities are lost.

Can You Still Get Unemployment After Severance? Here's What Really Matters

New York doesn’t automatically deny unemployment benefits just because you received a severance package. But there are several factors the Department of Labor (DOL) uses to determine whether you’re eligible and how soon your benefits can begin.

Why your employment ended

If you were laid off due to a department cut or company closure, you’ll likely qualify. If you resigned without a valid reason or were terminated for misconduct, eligibility may be denied. Severance doesn’t override the classification of your departure. That classification is central to the state’s decision.

Your current ability to work

To qualify, you must be immediately ready and legally able to work. Any medical limitations, visa issues, or caregiving responsibilities could affect eligibility. Temporary inability to work, even if short-term, can pause your claim. The DOL needs assurance you’re available for employment now.

Willingness to seek and accept employment

The state expects job-seeking efforts each week. That includes submitting applications, participating in job fairs, or attending interviews. You’re required to document your activity. Having that record can make a difference during eligibility reviews.

How your severance is structured

If your severance is a one-time payout, it usually won’t affect unemployment benefits. But if it’s paid out weekly or biweekly, it may delay your eligibility. Severance linked to ongoing compensation might be treated as continued wages. Ask your employer how they’re categorizing the payment.

What you disclose in your application

The state reviews both your submission and your employer’s. Conflicting details, like dates or reasons for separation, can trigger delays. Be thorough and truthful when completing your application. Supporting documents help ensure your account is verified.

Employer response and paperwork

Employers can dispute your claim, especially if they believe you resigned or were dismissed for cause. The DOL may request documentation from both parties. Keep your termination letter and severance agreement accessible. Consistency across records supports your case.

Other types of compensation

Paid time off, bonuses, and commissions must also be reported. These payments can impact your eligibility window. Even if they only affect the first week, failure to disclose them could be viewed as misrepresentation. Always include the full picture in your initial filing.

Want to Stretch Every Dollar? Here's How to Max Out Your Unemployment

Unemployment benefits can be a vital lifeline while you search for your next job. To make the most of what’s available, timing and accuracy matter just as much as eligibility.

• Clarify with HR: Ask whether your severance is issued all at once or in installments. Payments issued on a recurring schedule may be viewed as substitute wages by the DOL. This classification affects when your benefits can begin. Make sure you know your official termination date as well.
• Save your paperwork: Keep your separation letter, severance offer, and final pay stub organized. The DOL may request these during the verification process. They also provide protection in case your employer disputes your claim. Digital copies are acceptable. Just make sure they’re complete.
• Be accurate on your claim: Mistakes in your application can lead to denied benefits or even repayment demands. Report severance, bonuses, and the reason for separation correctly. If your entries don’t match your employer’s statements, you’ll likely face a delay. Precision now avoids bigger issues later.
• Track the timing: Don’t wait for your severance to end before filing. Submit your claim as soon as you stop working. Let the DOL decide how and when to begin payments. Filing early preserves your claim window and establishes your eligibility history.

Professionals impacted by business sale and purchase agreements in New York often think they have to wait before applying. But that delay can cost you. File promptly and let the system make the call.

Drowning in Rules? Here's What New York Doesn’t Tell You Up Front

Navigating New York’s unemployment system means understanding the small print and how it applies to your unique situation. These key rules often go overlooked, but they can make or break your benefits timeline.

• Base period: The DOL calculates your benefits using your earnings from a specific 12-month period. If this doesn’t capture your most recent wages, you may request an alternate base period. But you must ask. The system doesn’t do it by default. This is especially important if you’ve recently switched jobs or industries.
• Weekly certification: You must certify your status every week to keep benefits flowing. This holds true even if your claim is still under review. Missing a certification means losing that week’s payment permanently. Set a reminder to avoid missing this crucial step.
• Work search requirement: You must complete three job search activities per week, each on separate days. These can include applications, networking efforts, or attending job training programs. Keep detailed records of everything. The DOL may audit your activity without notice.
• Maximum duration: Most unemployment claims in New York last up to 26 weeks. Extensions are only available during periods of high unemployment. Once your benefits are exhausted, you’ll need to requalify under new criteria. Track your claim balance to avoid surprise cutoffs.

Even professionals who’ve handled business formation legal services find these rules confusing. Understanding them upfront makes the entire process smoother.

Don't Let These Mistakes Ruin Your Unemployment Claim

Many people lose out on benefits not because they’re ineligible, but because they made avoidable mistakes. 

One of the most common missteps is failing to report severance. Even if it’s a lump sum, it still needs to be disclosed so the DOL can decide how to treat it.

Another major issue is waiting too long to file. People often assume they’re not eligible until severance ends, but that delay can cost you weeks of benefits. File right away and let the state determine your timeline.

Certification errors are another stumbling block. You need to log in and confirm your status every week, even during the approval process. Skipping this means you won’t get paid for that period and you usually can’t go back.

Lastly, weak job search documentation can trigger audits and denials. The state expects a full record of your search activity, including dates, employer names, and contact methods. If you can’t produce it, you risk suspension of benefits.

If your job loss was tied to corporate restructuring or impacted by mergers and acquisitions, these mistakes can be especially costly. Accuracy from the start makes all the difference.

Talk to Horn Wright, LLP, and Confidently Move Forward

We support individuals throughout New York City as they transition out of employment and into what comes next. 

Whether you’re reviewing a severance package, filing for unemployment, or trying to understand how compensation impacts your claim, our legal team delivers focused, practical advice at every step. 

If you’ve worked with business transaction lawyers during a corporate shift or company restructuring, you know how important legal clarity can be. Our team will help you protect your rights and make smart, informed decisions that strengthen your financial footing. 

That’s just one reason we’ve been named among the country's top law firms and we’re committed to continuing the fight for your rights. 

If you’re ready to get started, contact our office today. Let’s schedule your complimentary case review.