The company may set the plan up on any period of time. It may pay out monies based on profits within a six-month period or quarterly period. Profit sharing plans can be designed in a variety of ways. The company can pay the profit sharing monies due an employee in a variety of ways. Generally, an employee can withdraw the money only at termination or for certain specified emergency uses.
Companies generally give employees the option of receiving the money in a lump sum or as an annuity.
Refer to Section 460.55 for discussion of eligibility if the payment is received as an annuity. The payment is based on the employee's work and is remuneration for personal services and is therefore wages as provided in Section 926 of the UI Code. If the money is paid as an annuity, it is treated as a pension and there is a question of eligibility under Section 1255.3 of the UI Code. In Benefit Decision No. 6275, the Board considered the question of whether a payment made to a claimant under his former employer's profit sharing plan was wages for unemployment insurance purposes and, if so, the period to which the payment should be allocated. In that case the claimant had last worked for a rivet company at the time of filing his claim.