Unemployment Matters

When an employer decides to terminate an individual’s employment, this action can trigger
various reviews and scrutiny related to unemployment matters. Understanding these reviews is
crucial for employers to ensure they are adhering to legal requirements and managing their
responsibilities effectively.

Unemployment Insurance Claims Reviews
One of the most immediate consequences of an employment termination is the potential for an
unemployment insurance claim filed by the former employee. Unemployment insurance
provides temporary income to individuals who lose their jobs through no fault of their own, and it
is funded through employer taxes.

1. Claims Process:
Eligibility Review: When a former employee files for unemployment benefits, the state’s
unemployment agency reviews the claim to determine eligibility. The review focuses on whether
the termination was due to misconduct, lack of work, voluntary resignation without good cause,
or other qualifying factors.
Employer Response: Employers are notified of the claim and have the opportunity to provide
their account of the termination. This is critical as it can influence the outcome of the claim. An
employer’s response should be timely and include any pertinent documentation such as
disciplinary records, attendance logs, and other relevant evidence.
Hearing: If there is a dispute over the claim (either from the employer or the employee), a
hearing may be scheduled. During the hearing, both parties can present their evidence and
arguments before a judge or an administrative officer makes a determination.

2. Impact on Employer Costs:
Rate Adjustments: The experience rating of an employer, which affects their state tax rate, can
be impacted by the number of claims filed against them. More claims can lead to higher
unemployment tax rates, making it financially significant for employers to manage terminations
and claims effectively.

Compliance Reviews
Employment terminations, particularly when not handled correctly, can trigger reviews for
compliance with federal and state employment laws.

1. Legal Grounds for Termination:
Discrimination Laws: Termination should not be based on race, color, religion, sex, national
origin, age, disability, or genetic information. Employers must ensure that the decision to
terminate does not violate these protections.

Retaliation: Employers need to ensure that the termination is not in retaliation for any protected
activities by the employee, such as whistleblowing or filing a harassment complaint.

2. Documentation and Procedure Compliance:
Documentation: Keeping thorough documentation on the reasons for termination and the
process followed is vital. This documentation can be crucial in defending against wrongful
termination claims or during audits by employment agencies.

Procedural Review: Many companies have internal procedures for termination that include
performance reviews, disciplinary procedures, and final exit interviews. Adherence to these
procedures can help ensure fairness and legal compliance.

Internal Policy Reviews
When an employee is terminated, it’s an opportune time for employers to review their internal
policies regarding employment practices.
1. Policy Consistency: Ensure that the termination process is consistent with internal policies
and that these policies are regularly updated to reflect current laws and best practices.
2. Training and Development: Regular training sessions for managers and HR personnel on
proper termination processes and legal compliance can reduce risk and improve management
of unemployment matters.

Terminations are complex events that can have significant legal and financial implications for a
business. By understanding and managing the types of reviews related to unemployment
matters, employers can better navigate the complexities of employment terminations, reducing
potential costs and legal risks while maintaining fairness and compliance in their employment
practices.