“Do unemployment policies need to be updated?”

More than 80 years ago, Franklin Delano Roosevelt established the Social Security Act to provide for the general welfare of workers. Most commonly, you see this related to the Social Security benefits people receive after retiring, but it covers other workers’ benefits, such as industrial accident victims, assistance for mothers and children, and unemployment insurance.

Since being established in 1935, not much has changed in the way the system works. Traditionally, employees who are let go “through no fault of their own” are entitled to weekly payments over a set amount of time until new employment is found. Employers pay taxes on both the state and federal level to support these employees.

Traditional unemployment insurance claims

When the law was created, employment was simpler. People worked in factories and offices, usually on a 9-to-5 or shiftwork schedule. Workers had to be laid off due to downturns in business and budget cuts, making them eligible for unemployment insurance.

Each week, they submit documentation to show they are still unemployed as well as what they’re doing to find something new. Either the employee is hired by someone else or the allotted time runs out and the benefits are no longer paid.

While this is the traditional method, employment isn’t quite as traditional anymore.

Updating your unemployment policies

Experts have realized the Social Security Act is beginning to fail an expanding share of the current workforce. The advent of independent freelancers and contractors are causing proposals to circulate advocating for change to the laws to cover them as well. As it stands, these types of workers are reportedly twice as likely to be let go.

Figure out what works for your company

Only you can answer the question of updating your policy for your company. If you are using many independent contractors, you could consider adjusting unemployment to cover these types of employees. Considerations could include how long they’ve worked for you, why you let them go, etc. If you still operate with a permanent workforce, your policies are likely still right for your team.

We’re here to help

Regardless of changing policies, tracking unemployment claims in a manner that is simple and efficient is always going to be a priority for your company. We understand unemployment claims and want to make sure you aren’t missing anything or overpaying. Find out how Unemployment Tracker software can help you today.