I worked with a person that was laid off with 6 months severance that was not reported to the state. They immediately filed for unemployment, and then the company hired them back as a contractor 4 or 5 weeks later. We labelled him the triple dipper and he said getting laid off was the best thing that ever happened to him and that he's basically rolling around in money coupled with a one month paid sabbatical.
In Texas, severance pay has no bearing on unemployment insurance. I did same thing but told unemployment office about severance pay, since I was too worried about breaking any rules.
They told me I could win jackpot but they would still legally owe me unemployment pay. It is all about actually woking. If you work and then get paid for that work, that's when you cannot claim unemployment pay.
So, technically, if you do contract work and still claim unemployment, then you are breaking the law.
Yes, I believe he was technically breaking the law by under reporting. My limited understanding was that he was able to avoid issues by billing as an LLC versus an individual and didn't draw a paycheck from his LLC while on unemployment, he just let the money stack.
