Personnel(ly) Speaking

A Monthly Newsletter from

Personnel Management Systems, Inc.

October 2007

 

Unemployment Insurance Claims-

To Fight or Not To Fight?

 

The Federal-State Unemployment Insurance Program was designed to provide financial assistance to eligible workers who are unemployed through no fault of their own.  Regardless of the reason for separation however, many departing employees file for unemployment compensation.  In general, dealing with these unemployment claims are not at the top of most managers’ favorite to-do lists.  So is it really worth spending the time and resources fighting the claims? 

 

Who pays for unemployment?

 

In most states unemployment insurance funding is based solely on taxes (i.e. unemployment premiums) imposed on employers (with the exception of Alaska, Pennsylvania, and New Jersey which require minimal employee contributions).  One important item to note is that the tax rate each employer pays is variable. This rating is based on an employer’s experience with unemployment (including the dollar amount of claims paid out) and their employee’s taxable wages.

 

Normally to determine an employer’s rate class, the State Employment Security Department (ESD) divides the total cost of all unemployment benefits charged to the company in the past four years by the total taxable payroll for that same period. The resulting percentage is the benefit ratio which determines an employer’s rate class and the amount unemployment premium paid. [1]

 

The bottom line is you, the employer, pay the cost of these benefits so it’s important to keep an eye on these claims.

 

I would like to save money on this controllable cost!  Tell me more…

 

If a former employee decides to file an unemployment claim, the employer will receive a claimant’s separation notice from their state unemployment agency.  These notices are time sensitive and must be completed and returned within a specified time period.  Based on your answers to this form (and possibly some verbal follow up from the agency), you will be sent a decision of whether or not the claimant is eligible for unemployment benefits.

 

Eligibility for unemployment insurance, financial amounts, and the length of time benefits are available are determined by the state law under which unemployment insurance claims are established.  Generally, claimants are awarded benefits if they are laid off or they lose their job through no fault of their own.  However, if a claimant is fired for misconduct or quits for personal reasons, the claimant may be denied unemployment benefits.

 

Employees fired for willful wrongdoing or misconduct can be denied benefits. In these cases it’s important to note that the burden does rest on the employer to make the case that the wrongdoing was willful; it violated known or reasonable rules; it was something the person was aware of; and that it was serious or could have potentially harmed the employer.

 

The government granted unemployment benefits, but I disagree with this decision!

 

When a discharge involves a significant violation of policy or work rules - for example, fighting, being under the influence of alcohol or drugs or various other major infractions -  you may want to challenge the decision.  Some additional considerations to think about prior to appealing a decision are:

  • Have you investigated all the policy or procedure violations associated with this claim?
  • Is there enough written documentation to support your case?
  • Have you followed consistent progressive disciplinary practices?
  • Is the former employee disgruntled and likely to file a lawsuit?

If you’ve answered these questions and still believe the decision was incorrect, filing an appeal may be your next step.

 

Appeals need to be filed by the deadline, which vary form state to state.  Once your appeal is received and processed by the state agency, you will receive information explaining your rights and responsibilities as a company in the appeal process as well as information regarding the scheduled unemployment hearing

 

What tips can help me with the hearing?

 

·        Show up! If you do not attend the hearing, the judge may rule against you.  If you absolutely cannot attend the scheduled hearing, make contact as soon as possible to ask if the hearing can be rescheduled.  Hearings are commonly held by phone.

·        If you have written evidence you want to use in the hearing, you must provide it to the Administrative Law Judge (ALJ) and the other parties involved in the hearing before the date and time of the hearing. If you fail to provide copies of your written evidence before the hearing, the ALJ may decide to not consider your evidence, or may have to reschedule the hearing so that all parties have a chance to review the evidence.

  • Determine if you need witnesses such as the direct manager of the terminated employee or other supervisors. If you do, discuss the situation with the witness as soon as possible to be sure he or she will be available to testify and that their testimony will add to your case.
  • Create a list of the information you want to cover during the hearing. Be prepared to present and answer questions concerning specific incidents which include the who, what, where, when, and why about the employee’s performance.

·        Stay on track and only present evidence that is relevant to your case.

  • Stay calm and objective!  Do not argue or get angry during the hearing. You will do a much better job of presenting your case if you remain composed.
  • If you want to be represented by an attorney or another professional representative (such as a PMSI representative), take steps to retain a representative immediately upon learning that an appeal has been filed.

Once the hearing is complete, the judge will review the case and make a decision based on the testimony and documentation submitted by both sides.  The ruling will be processed and a copy of the decision will then be sent to you and the former employee.

 

Whether you are just anticipating a possible termination or are in the midst of deciding whether to fight an unemployment claim, we hope you will refer to these guidelines.  If you need further assistance on this or any other Human Resource issue, call on Personnel Management Systems.

 

Personnel(ly) Speaking is a monthly comment on HR issues of importance.  It is intended to provide general information and must not be construed as legal advice.  Reproductions are allowed as long as credit for this information is given to PMSI.  We welcome your comments, questions, and concerns.  © PERSONNEL MANAGEMENT SYSTEMS, INC., Corporate Office (425) 576-1900, Colorado Office (720) 497-0200, www.hrpmsi.com.