What Does the Unemployment Compensation Process Look Like

The steps leading up to an unemployment insurance claim are pretty obvious – an employee is let go for one reason or another. After that, there are several steps that both employee and employer must go through.

1. A claim is filed.

Unemployment insurance is not automatically granted, so the former employee must submit a claim with your state’s unemployment office. Every state has different rules, procedures, and timelines, but no matter what, it’s up to them to file.

Depending on why you let this employee go, it becomes important to monitor for notice of this claim in case it needs to be contested.

2. Chance to contest.

Once the claim is received, you will receive a notice and have the opportunity to contest it. You will do this most likely if you feel like they do not qualify based on termination reasons. For example, if you let them go due to misconduct and repeated warnings, they are not eligible for unemployment benefits.

The process now can go one of two ways – either he or she will respect the decision or decide to appeal. If the latter happens, you will need to prepare for a hearing to present your case. Failure to participate may result in an automatic awarding of UI benefits to your former employee.

3. A decision is made.

If you have no reason to contest, the time it takes for the employee to start receiving their compensation will vary by state. Contesting means they will not receive benefits until a final decision is made.

While it’s an official hearing, it’s not in a standard courtroom setting that follows standard procedures. Both sides will share their story in front of representatives from the state’s board and provide evidence to support their side. As an employer, it’s important to keep detailed records and video evidence where possible to strengthen your case.

After hearing both sides, a decision will be made ultimately supporting your contest and not awarding benefits, or in favor of the former employee.

4. Continue monitoring.

When unemployment compensation is provided at any stage, it’s imperative to keep monitoring to make sure the former employees are following your state’s guidelines. There is a certain amount of time they can be received under certain conditions, and you want to make sure they’re being followed.

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