Ken’s Korner: Unemployment Insurance, A Cheeky Primer from a Vet

Ken’s Korner: Unemployment Insurance, A Cheeky Primer from a Vet

HR professionals can sit this one out because it’s their job to get nerdy about UI, unemployment insurance. This is for the supervisors, managers and owners.

A simple HR question was posed in a Q&A forum in another publication:

“We will be terminating an employee who’s been with us only a month. How do I ensure they don’t get unemployment?”

The question went straight to the point, there was no superfluous language nor did they try to provide their justifications within the question or go into background. The answer was straightforward, correct, and with little commentary.*  Having given many such answers and variations thereof, I’m ready to chuck that style of “correct and professional” aside. Why? It’s simple, it induces sleep and sticks with virtually no one.

I’ll tell you what I was really thinking: “Oh Gawd, not again, please just FORGET everything you’ve learned from every HR seminar, training, or government agency outreach event you’ve ever attended on this topic!” It won’t be hard, trust me.

Next, try to forget the word “unemployment”, or at least try substituting the word “job” or “bacon” for it and DO focus on the word “insurance”.

I wouldn’t be bragging to call myself an expert in UI. The State of Texas trained me and paid me to be and to supervise others in its administration. I only mention this to make the point that we all can’t be experts in everything. It’s exceedingly rare to find a good polymath anywhere these days. Although an expert in UI I’m a very typical idiot when it comes to other forms of insurance, especially the ones I most depend on and for which I pay thousands of dollars a year. My medical, auto and homeowners insurance policies are stuffed somewhere into my files where I slid them after giving them a cursory reading. I’m completely dependent on the expertise and integrity of the insurer’s employees. I spend thousands of dollars a year on this insurance but I can’t tell you how many exactly, without looking it up. While it may not be wise for me to be so inattentive and cavalier, it works for me. Every claim I’ve made in the last 35 years has been resolved to my satisfaction. I’m lucky to have not needed to make many. Yes, I know, UI is fundamentally different in that you are compelled to do so by a policy that benefits someone else. But it is still, just insurance.

Back to our opening question, “How do I ensure….” The answer is embarrassingly simple, You can’t. And that’s not your job. Someone else, a state government zombie drone will make that call. All you can do is provide the facts as requested, much like you’d do after a fender bender (hopefully it was the other guy looking at his smartphone.) If you disagree, there are highly structured avenues of redress you may pursue.

The other thing I was really thinking about the subject question was: “Cool it! The chance of you noticing a difference in your UI experience rate from a claim by this worker are roughly zero, zilch, or nil. I could explain why, but I’m trying my best to not lull you to sleep. Suffice it to say that the employee didn’t work there long.

Question: But what about all those seminars I’ve attended and what they’ve advise?

Answer: They’re fine; but how much do you remember? I’d recommend you go straight back to the office after one and review your own employee manual and your own job description. You should see common elements in those with what you’ve just been exposed to. So just keep those handy. And follow them. If there are problems in the employee manual, you may have just saved the day for your boss.

If you find yourself in a moment or an environment where the question, “How do I ensure…?” you will know that one of two things is true: 1) this is a mindless knee-jerk reaction due to the culture, passed down from managers to supervisors over years and throughout industries or 2) this is deeply personal so if at all possible, if you don’t have first hand knowledge of exactly why the termination is happening, steer clear! Otherwise not only will you not likely learn the truth, it’s a time and energy vortex about to suck you in.

If I had a nickel for every minute I spent with insanely irate employers…

It wasn’t until I was out of that circus that I got a little perspective. I was the guy taking people’s initial unemployment claims and their initial interview about their job separation. Mind you, a large percentage came in reluctantly and often then only at the insistence of a spouse. They usually had a question, they didn’t understand how UI works so they’d ask, “Could I possibly be eligible for benefits? I don’t really want to file a claim. I’m just curious.” Here’s the thing, we couldn’t answer them with anything but “We can’t answer you unless you file a claim.”

The last employer would then receive a letter telling them of the claim and asking for a response. Then I’d receive a call from the employer who was furious and wanted to know why a claim had been filed “against him!” They’d too often take it as a personal attack and get personal in response.

Then, after interviewing all parties again to resolve any discrepancies to arrive at the most likely factual basis of events, I would issue a determination letter.

Don’t get me wrong, claimants shared their grievances just as forcefully with me as the employers. But they had the new luxury of time to do so and they were newly broke.

But when I reflected on all that raw negative energy I had to think, was there anything comparable? Yes, it felt like being in the middle of a someone else’s divorce (which in a way it was I suppose).

I can’t escape these feeling of the waste of it all, the emotion that is — how that energy might have been put to better use. In case you were wondering, yes, I have heard that story about how badly the Employment Commission screwed things up and got everything wrong. Like I said, just like a divorce.

I’ll never know if I’d be able to separate my emotions from an unemployment claim as I advise others to do if I had run a business of my own. I realize my perspective suffers from biases I may not even recognize; but I can’t help but believe that de-emphasizing the unemployment claim a bit would help employers in the long run.


* Termination and UI Benefits

Question:   We will be terminating an employee who’s been with us only a month. How do I ensure that they don’t get unemployment?

Answer:   Unfortunately, unemployment insurance (UI) benefit claims can be difficult to contest. Most state unemployment departments will only deny benefits if the employee’s misconduct rose to the level of gross misconduct, like stealing or workplace violence.

Fortunately, however, the effect of a single UI claim on your state unemployment insurance tax rate is minimal to non-existent. More importantly, even if your UI rate increases, that additional cost is often less expensive than keeping on an employee who shows no willingness or ability to improve. If you have documented employee performance expectations and the employee still isn’t meeting them, I wouldn’t let the possibility of a higher UI rate dissuade you from termination. If you’re worried about your UI tax rate generally, the best thing you can do is minimize turnover.



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