Alabama Unemployment Compensation Laws for Temporary Employees

Monetary Eligibility

Alabama's unemployment tax laws require employers to subsidize the state's unemployment insurance fund by paying employment taxes on the first $8,000 of wages. An employee is eligible to receive unemployment benefits if his base period earnings equal or exceed 1.5 times his highest quarter earnings. A base period of unemployment is the last four of five quarters of employment before he files an application for unemployment benefits.

The Alabama Unemployment Compensation Law does not allow workers to receive unemployment benefits if their reasons for unemployment are voluntary or if they were terminated for cause. An employee's refusal to secure transportation or decision to relocate is considered as invalid and disqualifying reasons for unemployment. Additionally, an employee discharged for violating company policies, for committing a criminal act, for being tardy or for an unexcused absence is also a basis for ineligibility.

Casual, temporary employees may not be able to monetarily qualify for unemployment benefits if they have not earned a sufficient amount of earnings during a base period of employment. Employees who do not meet the monetary eligibility rules, including temporary employees, may be able to receive benefits under the Alabama Disaster Unemployment Assistance program. Due to the severe tornadoes and flooding throughout Alabama in 2011, President Obama declared over one dozen counties disaster areas on April 28, 2011. To file for disaster assistance benefits, applicants must submit their 2010 tax returns.

Employers are required to pay unemployment taxes for their part-time and full-time employees. They may be required to pay unemployment taxes for temporary employees if there is a "master and servant" relationship between them. Generally, an employer is required to report wages paid to temporary employees, and if an employer pays unemployment taxes on a temporary employee's behalf, those wages may count toward the employee's earned wages for monetary eligibility.

If a temporary employee is an agent of a temporary agency, the temporary agency is responsible for paying unemployment taxes. However, if an employer is responsible for directing or supervising an employee, the employer is directly responsible for an employee's unemployment tax contributions.

Employers are not usually responsible for paying unemployment taxes on independent contractors. The state uses a 20-factor test to determine whether an individual is an employee or independent contractor.

Since state laws can frequently change, do not use this information as a substitute for legal advice. Seek advice through an attorney licensed to practice law in your state.