Working for an immediate family member can allow you to collaborate with someone who makes you feel comfortable. If the family member's business can't keep you employed in the long term, you may be interested in applying for unemployment benefits. Depending on the type of business you work for, you may be entitled to those unemployment benefits.
Family Still Eligible
When you work for family members, this does not necessarily eliminate you from consideration for unemployment benefits. If a non-family member would be eligible for unemployment benefits after losing the same job, the family member employee should be eligible for benefits. When determining whether you are eligible, the important thing to look at is why you left the job and not your relationship to the employer.
Reason for Leaving
In most cases, the individual who wants to claim unemployment benefits must be relieved of his duties. If you quit your job, you usually are not be entitled to unemployment benefits. Most states have exceptions to this rule. For example, if you quit your job to take care of a sick spouse or if your spouse is taking a job in another state and you have to move, you could be eligible for unemployment compensation.
Shortened Benefits
Many states have rules that limit the amount of time some family members can get unemployment benefits if they lose their jobs. For example, in the state of Michigan, you get unemployment benefits only for 7 1/2 weeks if you are a 50 percent owner in the family business from which you were just fired. If you are the child of a 50 percent owner in that business, you also get only 7 1/2 weeks of unemployment compensation. If you or your parents do not have any ownership in the company, you can get full benefits.
Considerations
The type of business also can play a role in determining whether unemployment insurance can be claimed. If the business does not pay into the unemployment fund, then its employees cannot get unemployment benefits. For example, if a husband runs a sole proprietorship and his wife and kids help him out with some basic tasks, the wife and kids would not be eligible for unemployment compensation if they stop working for the business. It has to be a traditional business that has formal employees before unemployment benefits are paid.
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