The ABCs of Unemployment Compensation

The ABCs of Unemployment Compensation

• The Unemployment Compensation System in all States is 100% employer funded.

• Your Unemployment Costs are driven by the Benefits paid to claimants and charged to your account.

• UC Taxes are a variable tax based on Claims Experience. High Benefits Pay out = High Tax Rate

• Controlling Benefits saves your Company money.

How Does Your Company Pay Your UC Costs?

CONTRIBUTORY EMPLOYER

• “For Profit” company• Pays tax on a percentage of wages paid to employees

REIMBURSABLE EMPLOYER• “Non Profit” company• Pays dollar for dollar what is paid to claimant

Who Pays the Claim?

Base Period• A Base Period = first 4, of the

last 5 completed quarters, immediately proceeding the filing of an unemployment claim

• Determines monetary eligibility• Calculates unemployment

benefits, including Weekly Benefit Amount & Duration

• Determines chargeable employers

Benefit Year• Ability to collect benefits based

on states duration of benefits (varies state to state)

• Benefits collected result in charges to employer’s tax account

Base Period LagQuarter

Claim Filed Benefit Year

1st

QTR2018

2nd

QTR2018

3rd

QTR2018

4th

QTR2018

1st

QTR2019

2nd

QTR2019

52 weeks from the date the claim is filed

Base Period Employer Base Period Employer Base Period & Last Employer

Winning Strategies for Employers

You followed the company policy and separated that employee.

So why were they able to file and collect Unemployment Compensation against your company???

Small details can make a huge difference in the outcome of a UC claim filing. Here are some “easy fixes” and best practices that you can use now to win UC claims and save your company money.

In Order to Win

In order to win a UC claim for an employee that has been fired, you must be able to prove “Willful Misconduct.”

An act of wanton or willful disregard of the employer’s interest.

A deliberate violation of the employer’s rules.

A disregard of the standards of behavior which the employer has a right to expect of an employee.

Negligence indicating an intentional disregard of the employer’s interest or of the employee’s duties and obligations to the employer.

What is Willful Misconduct?

Proving Misconduct

The employer must be able to prove that:

THE EMPLOYEE WAS AWARE OF THE RULE

• Discussed at the time of hire; or written on initial employment application

• Outlined in company handbook with receipt signed by employee

• Through receipt of Written Disciplinary Warnings signed by the employee

Proving Misconduct

The employer must be able to prove that:

THE EMPLOYEE KNEW HIS JOB WAS IN JEOPARDY

• Verbally stated to employee in counseling session with a witness present

• Outlined in company handbook

• Through written Disciplinary Warnings that include, “Future violation of this or any other company policy may lead to disciplinary action up to and including termination.”

Proving Misconduct

The employer must be able to prove that:

THE EMPLOYEE HAD CONTROL OVER THE FINAL INCIDENT

• It is necessary to show that the claimant chose to engage in the behavior that caused them to lose their job

• “Accidents” are not considered willful misconduct as they are not intentional

• The final incident rises to the level of willful misconduct

The Top Ten Reasons UC Claims Are Lost

Firing and Re-Hiring of Problem Employees

Outdated/Inadequate Policies

Although the Claimant Violated Your Rule, They Can Prove Good Cause for Violating the Rule

Not Applying the Company Policy in a Consistent Manner

The Top Ten Reasons UC Claims Are Lost

Failure to Perform a Thorough Investigation of the Final Incident Prior to Separation. Hint: Always Get the Claimant’s Side of the Story.

Remoteness of Disciplinary Actions from Violation Incident; Allowing Employee to Work after Knowing that a Terminable Offense has Occurred.

Listing Multiple Reasons for a Termination

No Documentation to Support the Termination; Warnings Not Signed by the Employee

Untimely Responses/Late Appeals

The #1 Reason UC Claims are Lost

Using ANY of the “Words That Lose Claims”

In UC Law, there are words that pay claims and words that prevent claims. Often, a claim is lost because the employer failed to use the proper terminology when describing the incidents leading to a discharge.

Words That Lose Claims

If you use the following subjective phrases that the state considers to be an opinion and not factual, the employee will most likely qualify for UC benefits:

Poor Performance Bad Attitude Personality Conflict

Did Not Get Along with Coworkers

Not a Team Player Not Meeting Department Goals

Unable to Perform to Company Standards

Words that Win Claims

If you use the following objective, factual phrases, the employee will most likely be disqualified for UC benefits:

InsubordinationFailure to Follow

Supervisor’s Instructions

Violation of Company Policy

Failure to Follow Proper Procedures

Excessive Unexcused Lateness

Excessive Unexcused

Absenteeism

Unauthorized Possession of

Company, Client or Coworker Property

Questions??