Has your company ever agreed to not contest an unemployment claim as part of an employee’s separation agreement? Have you ever just gotten too busy to respond to Employment Security’s paperwork?
Or have you ever just let an unemployment claim go because you really like the former employee and want to help them out?
There are some new unemployment claim rules that might hit your business where it hurts–right in the bank account!
New rules for employers who don’t respond to unemployment claims:
Because of requirements that Congress instituted in 2011, all states have to tighten up their rules about employers who do not respond to unemployment claims, or face a loss of federal unemployment dollars–which in Washington’s case could cost the state up to $400 million per year.
Employers can lose their right to be relieved of charges for UI claims:
As of October 2013, an employer who has a pattern of failing to respond timely or adequately to a written request from ESD regarding a claim will lose their rights to be relieved of charges for the claim, and could be on the hook for the entire claim amount.
What’s a pattern? Under Washington’s new law, a pattern means a company has failed to respond adequately or in a timely manner at least three times in two years, or for at least 20% of their claims.
Why does this matter to federal and state governments?
In Washington state alone, over $74 million in overpayments was paid out in one year. Though only 5% were employer-caused, just reining that in saves $3.7 million.
So, pay attention to ESD’s paperwork, reply thoroughly and adequately to all claims, and reconsider deals you make with departing employees. This could save your company real money in the future!