When an employee is let go, they have several options to receive income during their period of unemployment. One option is unemployment insurance, where a former employee of a company is paid a percentage of their wages for a period of time between jobs. As an employer, here’s what you need to know about unemployment insurance and how it affects you.

Unemployment Insurance Basics

To be eligible, an employee must be dismissed without fault, typically because they were laid off. The Federal-State Unemployment Insurance Program is responsible for providing the benefits to qualified workers, using money from the employer taxes you pay at the state and federal level. Specifically, the money paid out comes from the State Unemployment Tax Act (SUTA) and Federal Unemployment Tax Act (FUTA).

The specifics of unemployment insurance are decided at the state level based on the federal program. Each state will have varying processes, but typically the benefits are available for up to 26 weeks.

Employee Eligibility

Once let go, your employee must file and prove they were let go at no fault of their own and continue to request benefits weekly. Failure to file a weekly claim can lead to their payments being denied. Items they must report include all income earned during the week as well as job offers and refusals. If additional information or meetings are requested and your former employee fails to provide the information or show up, it can lead to the benefits being denied.

If they become disqualified or are denied, they can file an appeal during a specific time frame. Similarly, if you as the employer do not agree with the decision, you can also appeal to the state regarding the eligibility of your employee.

Managing Your Unemployment Insurance Claims

Currently 12 percent of unemployment insurance charges are overpaid, costing employers billions of dollars annually. To avoid paying more than required, make sure you’re keeping track of all claims for your former employees.

Unemployment Tracker is a cloud-based software designed to centralize your data and save you time. It connects to state unemployment insurance agencies to keep forms automatically populated with the updated information for your records. Even better, Unemployment Tracker is completely customizable, so your reports show what you need to know.

Contact us today to request a product demo and see how Unemployment Tracker works for you.