November 8, 2022 | By Wendy Katz
What is the right thing to do when a former worker makes an unemployment claim? Do you embrace it or dispute it? The response depends on the cause for the termination and whether you can provide sufficient explanation or validation in those instances where the worker does not legitimately qualify for various benefits. Read on to learn when and how to contest an employment claim, what transpires when a former employee appeals, and why it makes sense to outsource employment claims.
When you terminate an employee who believes that the decision was unjust, they may file for unemployment benefits. The law guarantees unemployment benefits for employees who have lost their jobs due to no absolute fault. This includes any worker who is laid off due to a staff downsizing.
The employer has the right to dispute an unemployment claim. You should consider disputing a claim whenever the employee could have done something to keep their job but elected not to.
The law only entitles employees who resign on their own to unemployment benefits if they did so for "valid reasons." This includes those situations where employees had little choice because they would have been harmed or injured if they had stayed. If the employee faced constant harassment or was required to endure hazardous or unacceptable working conditions on the job, this would be considered a forced resignation. However, discontentment with one's job assignments is not a "worthy cause."
To successfully dispute an unemployment claim, including those involving resignation, you must prove that the worker left freely and without reasonable justification. This implies that the worker prompted the departure. It's important to note that if you offered the worker the opportunity to resign before formally dismissing them, this is not considered a voluntary resignation.
Misconduct includes those instances when you have had to dismiss an employee for purposefully or intentionally breaching workplace policies. Examples of willful misconduct might be when an employee takes company property without authorization, shows up to work incapacitated, fails a lawful drug screen, illegally shares trade secrets, uses abusive or offensive language, or displays another form of unprofessionalism that harmed your business's interests.
You can confidently challenge performance-based unemployment claims by demonstrating that the employee was provided sufficient warning and opportunity to improve their performance prior to the termination. Even with proper training, management support, and the employee's strong desire to succeed, sometimes employees fail to execute their responsibilities competently.
Unemployment benefits are readily available if a worker does everything possible to keep their job but is not "a good match." To avoid the potential for costly claims, employ prudent hiring methods, communicate appropriate probationary periods at the hire date, and establish benefit qualification periods that exceed the initial probationary period.
Most of the processes for contesting an unemployment claim start before deciding to challenge a claim. Preventing an unemployment claim conflict from occurring in the first place is the best way of ensuring that you don't lose when one arises.
The following practices will aid in your ability to minimize the number of approved unemployment claims.
Winning misconduct-related claims requires sound record-keeping and compliant HR procedures. Have an employee handbook and update it frequently to keep pace with growing legislative changes. The ability to refer to well-communicated employee policies aids in your effort to prove misconduct. Establish that the worker broke a particular written policy and that the policy was fair and in compliance with existing legislation. Demonstrate that the worker was aware of the established guidelines and that violating these policies can be grounds for termination.
When faced with an act of employee misconduct, consider the following questions in evaluating your ability to support your position:
Maintaining sound company-wide HR policies will also help to support that all employees at your workplace are treated equally. This ensures that there are fewer chances of discrimination and that the employment termination was just.
Upon notification that a former employee has filed a claim for unemployment benefits, begin planning immediately to ensure that your paperwork is collected and submitted on schedule, all necessary documentation has been provided, and you have identified the relevant witness testimony for the trial. One typical mistake with witnesses is using individuals without firsthand experience of the termination process to testify. Even if secondhand testimony is admissible, it lacks the weight of testimonies from those present when the events under question occurred.
A third party familiar with the unemployment claims procedure can be of tremendous help since they can examine the facts rationally and with no emotional attachment to the claimant. They will ensure that all documentation supports the employer's position, offer trained expertise with the claimant's cross-examination process, and use laws and regulations to cast suspicion on the claimant's account of events during a hearing.
When a former employee files an appeal, a hearing is usually arranged where the employee can offer support for claim approval. The employee can also present witness accounts – respondents can be interviewed in person or through written testimony. Third-party statements may be highly impactful if the reasons for their departure from the job are in question.
For example, suppose the employee resigned due to persistent sexual harassment. In that case, they may submit testimonies from colleagues attesting to the harassment actions or provide a written explanation from a physician stating that their health was deteriorating because of the abuse.
Sometimes, even after you file an appeal for review and provide the required documentation, the employee could still prevail and be awarded unemployment benefits. Certain jurisdictions will still allow you to appeal to a higher level of agency scrutiny. The employer and the worker can contest the existing appeal judgment through the appropriate state unemployment office.
Unemployment claims can be expensive since they ultimately raise your unemployment insurance premiums. This increase in taxes can extend for years after the former employee files the unemployment claim, increasing the financial pressures on your business. Furthermore, managing the hearing process can be highly stressful for the employer.
Despite having in-house HR staff, you and your staff may not be adequately equipped or have the time to address claims efficiently. Outsourcing HR provides the benefit of having an expert who can stand in front of the applicable appellate body on your behalf and ultimately helps you lower the associated costs.
Wendy Katz is the Chief Financial Officer at Questco Companies. Wendy is aiding our clients’ drive for profitability and compliance by providing pragmatic insights and sound financial solutions to constantly evolving HR challenges.