7 Ways to Keep Unemployment Claims Under Control

Unemployment Claims.

The Federal-State Unemployment Insurance Program provides financial aid to eligible workers who are unemployed through no fault of their own, as determined under state law. All businesses pay for mandatory unemployment insurance to cover the cost of this benefit and annual rates will vary depending on past unemployment claims against the business.

Although laws vary by state, generally employees that quit are not eligible for these unemployment benefits, while those who are fired are eligible. Fired employees may not be eligible if they are dismissed for misconduct involving disregard of the employer’s interest, deliberate violation of known company rules, failure to meet customary expectations of behavior or wrongful intent. For more information on specific state unemployment laws, visit the United States Department of Labor website.

While there are many factors that influence a legitimate unemployment claim, one thing is certain. When multiple claims are made against your business, your unemployment tax rates can skyrocket.

Below are 7 things your business can do to proactively protect your unemployment rates by controlling unemployment claims.

  1. Fight unemployment claims that are unreasonable within the time specified. Meeting deadlines is extremely important when submitting information to the unemployment office. The state will often favor the claimant when a representative from your company misses a hearing date or does not adhere to a response deadline.
  2. In order to determine which unemployment claims are legitimate, you will have to educate your managerial staff on applicable state and federal laws regarding unemployment benefits.

    Communicate your processes for responding to unemployment claims to all managers and identify a human resource expert to whom they can direct questions. It is expected that the direct manager of the employee in question, in addition to your human resource representative, will sit in on the proceedings of any unemployment disputes. Additionally, first-hand witnesses must be present on telephone hearings in order for your company to create a believable case.

  3. Publicize your company policies. You can only prove that employees have broken rules if it is clear the employee has been made aware of and understands the rules of your company. Create a simple document that states the employee received and understands the information. Also, include policies in the employee handbook and requires every employee to read and sign that document. Collect updated signatures as the handbook changes over time or when new employees are hired.
  4. Document misconduct. It is the employer’s obligation to prove misconduct occurred. Work with your HR team to ensure all managers are keeping records, with employee signature, of any discipline between a manager and an employee. Managers should also retain phone records, copies of emails or other items that will serve as supporting evidence. Documenting issues as they occur will ensure you do not need to rely on memory. Improperly documented or undocumented issues could be considered hearsay and may not support your case.
  5. Be consistent when enforcing policies. You will have a difficult time convincing the state that an employee engaged in serious misconduct if another employee exhibited the same behavior without consequence.
  6. Inform your employees that termination could be a consequence of certain behaviors. If the employee knows the company rules and consequences but chooses to act anyway, deliberate violation or disregard can be proven. Your handbook or disciplinary actions should utilize the language “discipline, up to and including discharge”.
  7. Terminate the employee within a reasonable time frame. If a significant amount of time passes between the misconduct and the termination, it may be perceived that the misconduct was not the true reason for termination.

Putting these measures in place will make fighting illegitimate unemployment claims less difficult. It will also help protect your company’s unemployment insurance rates. If your business does not have an HR expert on staff, consider a partnership with a Professional Employer Organization (PEO).

Tandem HR

A Chicago area PEO that assists hundreds of small and mid-sized businesses with the unemployment claims process as well as other areas of employee relations. They also help clients save time and money while growing their business. PEO’s take on the administrative tasks associated with human resources, benefits, payroll, tax administration, regulatory compliance and risk management.

If you have any other questions, please reach out to us at 630.928.0510 or fill out the form below and one of our Business Development Managers will contact you.


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