Tips for Controlling Unemployment Insurance Cost
Unemployment insurance costs continue to rise. SESCO provides the following tips to maintain a good unemployment experience rating:
• Become familiar with the non-charging provisions of the UI State Law in your state. It is important to quickly and effectively contest improper claims lodged against the employer's account.
• Keep track of statements of accounts furnished by the state agency that reflect the charges on the account of benefits paid to employees. Check the statement carefully for mechanical errors. It is not uncommon that statements are sometimes incorrect.
• If the rate has been incorrectly determined, immediately notify the state agency.
• Do not allow unsatisfactory employees to build up base-wage credits. In states where a former employee's base-wages are charged in whole or part against the base-employer's account, do not allow unsatisfactory employees to build up wage credits and thus increase potential charges to your account. Remove unsatisfactory employees as soon as possible to avoid this build up of wage credits.
• After hiring new employees, carefully follow their progress and dismiss them promptly if they prove to be unsatisfactory. Most states do not deny benefits to employees dismissed for mere inefficiency or incompetency, which means that the longer an inefficient employee remains employed, the greater the potential charges against your experience rating record when he or she is ultimately separated.
• Give every employee who leaves a separation interview. Whenever an employee is dismissed or leaves employment voluntarily, be sure to conduct a separation interview. Inquire carefully into the reasons for leaving or the circumstances surrounding dismissal and, of course, document thoroughly.
• Keep accurate records concerning the circumstances surrounding an employee's dismissal or leaving. Include any dismissal, severance or vacation payments made at separation, and, if possible, secure a signed statement from the employee as to the reasons for leaving. Often a good employee can be persuaded to stay if the employer can find cause, personal or otherwise, of his or her dissatisfaction.
• At the time of separation, the employer should notify the separating employee of his or her rights to unemployment insurance. Many employees resigning or quitting will file for unemployment regardless.
• Be careful in the selection of new employees. The discharge of an employee for inefficiency or because of inability to perform the duties on the job does not ordinarily disqualify the employee from receiving unemployment benefits. Therefore, the best way to avoid unemployment cost is to hire the right person the first time.
• Contest or appeal unemployment claims. Most states process unemployment claims without challenging the ex-employee or claimant. Many times states will grant unemployment benefits without considerations for the separation. Of course, voluntary resignations should always be challenged. Employers should challenge terminations based upon "gross misconduct." Finally, employers should always challenge or appeal when terminated for insubordination or other willful acts. Willful acts include absenteeism, ignoring a request or job assignment, willfully or intentionally not adhering to company policy or job standards or expectations — simply just not caring or other willful disregard for the job can be grounds for loss of UI. We at SESCO have been very successful in representing our clients before state agencies by thoroughly explaining and articulating that the employer did its part — the employee just didn't do his or her part and wasn't making a reasonable attempt to improve performance or perform the job as expected.
• Develop and provide a thorough and complete employee handbook, job description and other standards and expectations of employment and have the employee sign for these employment documents.
SESCO Management Consultants is available to assist with your human resource issues. You may contact us by phone at 423-764-4127 or by email at sesco@sescomgt.com .