Managing Costs by Managing Unemployment Claims

33 Headphone Dude Wacomb Tablet

Effectively managing unemployment claims can be helpful in protecting the tax rate set by the State Unemployment Tax Act (SUTA), and in turn, protecting company costs from sharp increases.

Unemployment compensation is granted when an individual loses his or her job due to no fault of their own.

Each unemployment claim directly affects a company’s SUTA tax rate, so it is in an employer’s best interest to pay close attention to every claim they receive.

Every time an unemployment claim is received, a response is legally required within the given time frame. Here are some qualifications for who actually is eligible to receive unemployment benefits and the documentation employers should provide when responding to claims.

Employees will typically receive unemployment if their work hours have been restricted or reduced through no fault of their own, or if they have lost work through a layoff or reduction in force.

The following reasons would generally not qualify an employee for benefits:

  • Voluntary resignation
  • Willful misconduct 
  • Intentional violation of company policy
  • Failure to follow instructions
  • Excessive absenteeism or tardiness (except those that can be excused by a disability or medical condition)
  • Failing to meet normal standards of behavior

If an employee is forced to resign or given the choice between termination or resignation, the state will generally view this as an involuntary termination of employment and award benefits to the claimant.

To prove willful misconduct, documentation will be required. It is important to have written evidence of the facts and events leading up to the separation. Documentation of verbal and written warnings are sometimes the most important evidence.

Other useful documentation includes resignation letters, attendance records, witness statements, email correspondence, signed acknowledgment forms for handbooks or procedural documents, performance reviews, and performance improvement plans.

Nextep handles the entire unemployment claim process for our clients, including responding to claims, attending unemployment hearings, gathering documentation, and providing best practices and advisement that will help mitigate issues in the first place. For assistance in effectively responding to and managing unemployment claims at your company, please contact Nextep’s HR team.

Also on Nextep

Ah, the holiday season—a time for joy, festivities, and the age-old puzzle of compensating your employees. Let’s demystify the rules of holiday pay for both our hourly (nonexempt) and salaried (exempt) workers. For the Hourly Heroes Picture your business decked out in holiday cheer, but your nonexempt employees are sipping cocoa at home. Under the […]
Read more
Keep Your Party Pants Professional As the year ends, and you’ve achieved feats at work that deserve a standing ovation, the holiday office party is your well-earned, much-awaited reward.  But beware! When the festive spirit meets the allure of a bottomless drink supply, things can take a wild turn, leaving you nursing a hangover, regret, […]
Read more
At Nextep, we aim to stay informed about CEO concerns in order to better help with problem-solving. We were surprised to learn that sustainability has become a top concern. The statistics bring CEO concerns to light: A Gartner survey found that CEO concern about sustainability has increased 292% from their 2021-22 survey. In a survey […]
Read more
It’s not the most savory of topics, but still merits discussion. All of your employees will need to use the bathroom during work. Here’s a potty primer, if you will. Disability and Bathrooms The Americans with Disabilities Act (ADA) has clear regulations on bathroom accessibility in the workplace. Much of the guidance revolves around making […]
Read more
We’ve reported at length about preventing discrimination in the workplace. But let’s take a step back now and brush up on Title VII, the sweeping regulation that started it all.  Title VII of the Civil Rights Act forbids discrimination in any aspect of employment, including hiring, firing, pay, job assignments, promotions, layoff, training, fringe benefits, […]
Read more
Illinois to Join in on Pay Transparency As we recently reported, pay transparency laws are gaining momentum across the United States. Now, they have another state to add to the roster.  Illinois recently passed an amendment to the Illinois Equal Pay Act that will require employers to show pay and benefits information when posting a […]
Read more
Time to check your handbook again for NLRB compliance The National Labor Relations Board (NLRB) has been busy shaping employee handbooks and workplace policies. With the recent Stericycle Inc. decision, the NLRB has introduced a new legal standard for evaluating employer work rules under Section 8(a)(1) of the National Labor Relations Act (NLRA).  Understanding the […]
Read more
Spoiler Alert: Yes We frequently see a question posed to HR pros: “Do I have to pay my employee if…?” We’ll go ahead and give you a major hint at the outset. In many of the scenarios we see, the answer is yes, you do have to pay your employee. Here are a few scenarios. […]
Read more
The Answer Depends on Your State…For Now As we reported in January, non-compete agreements preventing employees from working for competitors are becoming increasingly unenforceable. The FTC is currently working on banning them at a federal level, but unless and until that decision comes, non-competes are enforced at a state (and sometimes even local) level.  As […]
Read more
When hiring workers, knowing whether they’re employees or independent contractors is essential. The difference between the two can significantly impact your business, including your tax liability, your liability for workers’ compensation claims, the worker’s rights and benefits, and your ability to control how your workers do their jobs. Read all about it here, and check […]
Read more
Employers Must Now Prove “Substantial Increased Cost” to Deny Religious Accommodation Recently, the Supreme Court ruled that employers must now demonstrate a substantially increased cost to deny an employee’s request for a religious accommodation.  This ruling, which comes in the case of Groff v. DeJoy, clarifies the standard for “undue hardship” under Title VII of […]
Read more
Here’s How the Recent Ruling Affects Your Company You may have read that in late June, the Supreme Court struck down affirmative action in college admissions. Here’s the implication this ruling could mean for you as a small or medium-sized business owner. To be clear, the Supreme Court’s decision on affirmative action does not explicitly […]
Read more

Download Our App