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Unemployment Insurance Claims and Your HR Platform – Questions To Ask

Unemployment Insurance Claims and Your HR Platform – Questions To Ask

No matter your company’s size, your niche, or your location, it’s inevitable that at one time or another you’ll likely have let an employee go. This is rarely an easy decision to make– and the process of executing is often much harder than that.

No matter your reason for letting your employee go, there are some very important things you need to keep in mind when a former team member officially becomes “unemployed.” In many cases, your now-former employee is entitled to certain unemployment benefits. There are many resources at their fingertips to help them file a claim, and potentially begin drawing unemployment revenue.

But what about you, the business? It’s never your intention to willfully put someone in a bad position, but if letting someone go is necessary, you should also know your rights, responsibilities, and what the process is for you as a company.

In this guide, we’re going to walk you through some key information when it comes to unemployment insurance claims, and how to navigate rising unemployment insurance rates.

No matter what your human resources tech stack and platform is, Quentell will help you learn what questions you should be asking.

Tax

What Happens When a Former Employee Makes an Unemployment Claim?

Typically, when you let an employee go, one of the first things they’re going to do is file an unemployment claim. We’ll go into detail about exactly what happens when a former employee files a claim, but first, let’s cover some important, foundational basics. From an employer’s perspective, here are a few things that you should know about unemployment claims management.

Unemployment Claims 101

Firstly, when it comes to actually paying out unemployment claims, this is only supposed to occur when an employee loses their job for reasons that are beyond what they can control. This is commonly due to things like being laid off or cut due to downsizing, being relieved after seasonal work, or when a company goes out of business entirely.

When an employee files to get unemployment benefits, that’s when unemployment insurance– often abbreviated to UI– comes in. UI is what helps to pay these people while they seek their next steps. UI helps people stay afloat with some financial help, but what does it mean for you, and how much does it cost?

Typically your UI payments are going to be calculated by taking an individual employee’s income and then taking a percentage of it over the course of 52 weeks.

As that percentage accrues, if that employee is let go, claims can be made against the total amount for a specified amount of time (typically around 6 months or so after the employee is no longer with the company). Unemployment benefits also typically cease once the former employee finds new full-time employment.

So Who Makes UI Rules and What Are They?

This is a great question, and the answer might seem a little complicated at first– but stick with us, and we’ll guide you through everything.

Now the tricky part is that FUTA is actually controlled jointly by both the federal and state government. So this means that in addition to the national federal rules, it’s very possible that your territory, district, and or state has its own set of regulations and rules.

What in the World is FUTA?

Firstly, the general guidelines and regulations for how unemployment insurance is handled is dictated by the Federal Unemployment Tax Act (commonly abbreviated as FUTA).

At the federal level, the government chooses to collect unemployment money using the following mathematic formula:

FUTA = 6% of the first $7,000 paid annually to each individual employee

In addition to that amount of tax, your business also needs to fill out and submit Form 940 and submit it to the Internal Revenue Service (IRS) every year.

Okay, So Now What in the World is SUTA?

Secondly, the general guidelines and regulations for how unemployment insurance is handled by each state can vary. But no matter the rate, each state collects its unemployment funds through the State Unemployment Tax Act (commonly abbreviated as SUTA).

Note that SUTA is also sometimes called state unemployment insurance

When it comes to the amount that you need to pay for SUTA, each state tends to determine that for themselves. So depending on where you’re located, your rate is likely going to be different. In some states, the regulations state that employees have to pay toward state unemployment taxes, in other states they do not.

Who Pays Unemployment Taxes?

That is a great question. Commonly, unemployment taxes are made up of the funds collected through the Federal Unemployment Tax Act (FUTA) and the State Unemployment Tax Act (SUTA), which are almost exclusively paid by companies/employers. There are some exceptions to this, and some states require employees to contribute to their unemployment taxes as well.

UI Claims Can Be a Costly and Complicated Landscape

If all of the FUTA and SUTA math sounds like a lot to keep track of, know that you’re right, and it is. Also, know that here at Quentelle, we can help you navigate UI situations expertly… but more on that later. Let’s continue to learn more about how you can equip your business to handle claims.

UI Claims Can Be a Costly and Complicated Landscape

What Happens After an Employee Files a Claim?

Typically when a former employee files for unemployment, when their claim goes through you’ll receive something called a “Notice of Unemployment Insurance Claim Filed.”

This notice is a letter from the state where your business is located in. Remember that this notice isn’t an automatic ruling in favor of the person filing unemployment– it’s just your formal notification they are filing in the event you disagree with the claim.

At this point, you have the option to either accept or contest the unemployment claim. Read on for more details on what that means, and what you need to do either way.

Accepting Unemployment Claims

If a claim is legitimate, we recommend that you accept it, and don’t contest it in any way. If you’re wanting to be sure that a claim is above board and valid, there are a few things to keep an eye out for.

First, was this person let go for reasons outside of their control? Or did you let this person go because of financial issues within the company? (That is a telltale sign.) On that same note, did you lay this person off because there just wasn’t enough work to go around? Finally, there are some cases where employees may lose their jobs because of an error that you or the company made– in that case, they’re typically entitled to unemployment.

If a claim is accepted by you, the state will come to its formal decision on whether or not they deem the person eligible for unemployment benefits.

Contesting Unemployment Claims

So what happens if you receive your “Notice of Unemployment Insurance Claim Filed” letter, and ask yourself the questions in the above ‘Accepting Unemployment Claims’ section. But your answers lead you to the conclusion that the claimant has no right to unemployment benefits? You still have options. Here are some other things to ask yourself.

Did you have to terminate the employee for any sort of misconduct or violations of policy? Was this person an independent contractor? Did the employee quit for another employment opportunity that didn’t pan out? Was anything on the unemployment claim untrue?

If you answered yes to any of those questions, you likely have a solid, justified reason to contest this person’s unemployment claim.

How Do I Contest a Claim?

It’s typical that all unemployment claims will be handled by your state’s unemployment department. To formally contest any unemployment claims, you need to contact them for the next steps.

They will typically ask you for the specifics of the situation. When you contact your state’s unemployment department about an unemployment claim, you should have the following information about your former employee ready:

  • Why is the individual is no longer with the company?
  • What was their pay rate/compensation plan?
  • What was their job title?
  • Other details about their role, and your company

Note that the unemployment department takes claims very seriously, and follows a specific and rigorous unemployment claims process. You will need to provide clear, specific, and in-depth information on any unemployment claims you wish to contest.

Note that each state handles its unemployment claims processing differently. The most typical method they prefer for contesting a claim is a letter. If your state agency does prefer a letter, it’s important that you send it within the timeframe that’s mentioned on the initial “Notice of Unemployment Insurance Claims Filed.”

If you don’t respond to the unfit claim within the timeframe on the notice, you will potentially have your unemployment tax rate increased, and in some cases other penalties as well.

Where Do Furloughed Employees Fall?

This may seem like a gray area since it’s typical that any furloughed employees often retain all benefits and are able to transition easily back into their existing roles. However, even though they are technically not terminated, furloughed employees are often eligible for unemployment claims benefits. Don’t automatically contest the unemployment claims that have been filed by employees who are furloughed, and instead look into the details of the matter more deeply before you make a decision.

What Happens Next?

When the state reaches its final decision as to whether or not a person will receive unemployment benefits they’ll send another letter– this is a letter of determination– to you and the former employee who filed the unemployment claim.

If the state rules during the unemployment claim’s processing period that the employee you let go is eligible for unemployment benefits, there’s little you have to do. Once this ruling is passed, the funds will start coming from your business’s unemployment tax account.

If for any reason the state denies the unemployment claim, the person filing (known as the claimant) has the right to appeal this decision.

Your UI Insurance Rates May Increase

Note that in some cases, once you accept one or more former employees’ unemployment claims, your unemployment tax rate may increase. This is an unfortunate side effect of an unfortunate situation, but again, we encourage you to accept any legitimate claim, even if it means an increase in your taxes.

Employment Verification in this Complicated Landscape

A note for hiring managers and HR departments to consider. As unemployment numbers increase, people are more willing to bend the truth when it comes to their resumes. Applicants can’t typically survive on an unemployment wage alone and are willing to become very competitive to get a position.

You also don’t want to hire someone who won’t be a long-term asset to your company, and who is just looking to land something because they’re desperate. Employment verification systems allow you to get accurate, specific information about people before you hire them.

When you look at someone’s actual job history you’ll be able to see employment gaps, specific dates and roles, and other details that will help you make an educated decision on every person who joins your team.

From Paper to Digital: How the UI Claims Processed Has Evolved Over the Years

Unemployment insurance is likely older than you think. Let’s take a look at some of its history to truly observe its roots, and how it is meant to be used.

The Old Way: The Birth of Unemployment Claims

In truth, the true genesis of unemployment insurance was born out of the Great Depression. In 1929, the nation saw an intense economic depression which led to many people being unemployed. In fact, it got so bad that many people were considered “permanently unemployed”– and while the terms weren’t always literal, they might as well have been.

The economic downturn saw many moving transiently from job to job, sometimes with an especially long period in between. In many cases, the job market was so saturated and competitive that there were literally no jobs left, but millions still needed employment.

Over time as the nation began to rise again to some sort of financial normalcy, the general public and the Federal Government alike came to realize that there was a very real issue called “unemployment” and they began to take action.

During the depression, the Federal Government spent around $7,000,000,000 on work relief programs, with local and State governments pitching in about $1,500,000,000.

This unemployment relief began to make a difference, though it was a primary reason for many government deficits at that time. Thus the concept of unemployment was born and enacted in its infancy.

Over time, the nuances of unemployment insurance have changed– arguably every year since its creation. Various State laws and Federal requirements have shifted consistently to grow and change with the needs of our current economy.

In the past 50 years alone there has been much experimentation at the state level to try to find new methods of running the unemployment insurance system.

Over time, the growing pressures and higher costs have strained the unemployment insurance system– especially during times of uncharacteristically high unemployment levels.

During these times, high benefit payouts have encouraged states to raise their taxes above the Federal level– even with the Federal amount now being $7,000 (this was the last increase, which happened in 1985).

UI Claims In An Analog Time

Until not too long ago, all unemployment claims management was done using cumbersome, analog methods. As late as the mid-2000’s people who wanted to file for unemployment needed to drive to an Unemployment Office in person and speak to an officer for assistance.

From there much of the process was handled on paper, with those who were unemployed calling into a phone system to get and receive updates.

The same clunky, analog methods were used for handling unemployment claims for businesses. The whole process for any business owner or HR Department was time-consuming, not entirely reliable, and moved at a glacial pace.

Whether you were an employee or an employer, handling unemployment claims was a known pain that no one looked forward to.

UI Claims Enter the Digital Era

We’ve officially entered a new era when it comes to the secure, fast, digital capabilities of handling unemployment insurance claims in the digital era of today.

Handling your UI claims digitally has never been simpler and more automated. However, it’s important that you choose a provider carefully.

You need to be certain that your digital UI partner can provide you with simplified unemployment claims management that’s powered by data, uses the very best in class technology, and has unparalleled expertise when it comes to UI claims.

Here at Quentelle, we offer all of those things and more. We would love to show you how we can help simplify your unemployment claims management process and bring you into the modern era safely and securely. We also want to warn you against technical debt…

Technical Debt From Legacy Systems

Sadly, even with the incredible advances in secure, simple UI technology, many companies are still handling their unemployment claims like it’s 2007. Many companies are stuck doing things “the way they’ve always done them,” and sadly are missing out on worlds of security, speed, and accuracy.

Some of these companies who are in “technical debt” because they refuse to move away from legacy systems feel the pain of this decision with the multiple unemployment claims they have to deal with manually.

In fact, if we take a good hard look, the way that some companies handle their unemployment claims process is the oldest and least updated aspect of their business. It’s akin to sticking with a fax machine in the world of the internet. And yet, many still choose to do so.

If this sounds familiar, we want to let you know that it doesn’t have to be this way.

The Current Landscape of Digital HR – Platforms Employment Verification and Tax Impacts

While handling your unemployment claims is a major benefit of using a digital HR platform like Quentelle, that is only one of the key benefits that you can experience.

Digital HR Means Data to Analyze

In the current landscape of digital human resources tools, when you use modern tools, you’re going to take your old processes and make them faster and more secure… but that isn’t all.

Speed and security are important, but another invaluable aspect of taking your HR suite digital is the ability to access powerful analytics. Gone are the days of paper forms, photocopies, and print-outs. When you work using analog systems you can’t see valuable patterns in your HR data.

When you use a turnkey HR suite like Quentelle, you’ll be able to take a look at your HR’s analytics and metrics from a 50 thousand foot view, but also dive in as deeply and specifically as you want. With this flexible method of looking at your data, you can feel confident and empowered in your business decisions, and ultimately save time and money.

Stop guessing, and live in a world where you have easy access to data-driven insights.

Employment Verification

When you use our accurate, robust employment verification tools, you’ll save time and reduce staffing costs by automating requests.

We put a strong focus on data privacy and security with every request. We use proactive threat screening and at-rest encryption for added safety measures on top of our FCRA compliance and SOC I & II certifications.

Tax Credits and Impacts

We have a partnership with Walton, a top provider when it comes to employment tax credits. Their data integrates seamlessly with our platform which gives you a simple, streamlined solution that screens all of your employees for Work Opportunity Tax Credits (WOTC).

We’ll leave no stone unturned when it comes to finding you any other tax credits you’ll qualify for, including federal, local, and state tax credits that your company may qualify for.

Not only is our process simple (you’ll use a proven, short questionnaire during your employee onboarding or hiring process), but we can also electronically file for any credits to ensure you make the deadlines to qualify.

Smart and Simple Redefined

We specialize in working with companies like yours to deliver the smart you want, and the simple you need. No matter which of our solutions you’ll need the most, you’ll find that we are one suite of proven solutions that work together seamlessly.

When you work using our platform, you’ll experience:

  • One platform: A single, award-winning platform gives you a simple user experience.
  • One contract: we use a simple, single service agreement.
  • One data source: Goodby multiple payroll files, hello leveraging a single file for all services.

Quentelle: The Best in Unemployment Claims Management

When it comes to an all-in-one, turnkey HR platform, Quentell is the gold standard and the industry leader. We understand that no matter what size or type of business you are in, you’ll inevitably have to deal with unemployment claims.

And as you deal with those unemployment claims, you’ll also find that it can be tiresome and challenging to devote the necessary time and effort to them. Your HR team is having to your state’s specific requirements under tight deadlines, which takes up their valuable time and attention.

And if you’re like most companies, you’re doing your best to implement and maintain consistent separation policies to try to drive unemployment claims costs down.

Additionally, most companies don’t have a single, centralized method of unemployment claims correspondence, so it’s inevitable that some claims will slip through the cracks. And what does that mean? increased unemployment tax rates and inflated annual tax costs.

Through our trusted partnership with ValU NSN, our team here at Quentelle is able to provide the absolute best-in-class Unemployment Claims Management Program to companies of all sizes.

So what sets our comprehensive solution apart from the competition? Here are just a few key elements.

Electronic Transmission

By using the State Information Data Exchange (SIDES), we’re able to electronically transfer all unemployment claims documents electronically. Since we can transmit any information quickly and securely, you’ll no longer be at the mercy of the deadlines and speed of the US postal service.

This flexibility grants our clients almost a full additional week to gather important documents and respond to claims. When you can gather the right information and deliver it with a quicker response time, you’ll not only transfer your data quickly and safely, but you’ll also be able to secure future appeals rights as well.

Simple Claims Handling in One Place

Our system will let you review each claim that comes in carefully. This allows you to determine if a claim is eligible– and if so– the amount and the benefit period of the claim as well.

Our system allows you to receive all claims directly from the state, and right within our platform. When you have your claims in one clearly organized location, you’ll also be equipped to dispute questionable claims more easily. And whether a claim is approved or you contest it, you can deliver responses to inquiries quickly to get ahead of state deadlines.

By handling your claims this way, your HR team can have a unified, organized approach to handling all unemployment claims, which means a more efficient workflow, and better use of their time.

Our system also easily allows your team to investigate separations so that you can get the best possible outcomes– which will reduce costs.

Professional Hearing Representation

If you do have a claim that results in a hearing, you won’t have to handle it on your own. When you’re partnered with Quentelle, any claims that result in a hearing will be administered by our highly-trained, dedicated staff.

Our staff averages 20 years of unemployment proceedings experience, which we use on your behalf to get the best possible outcomes. When we handle your hearings we’ll ensure that every witness is fully prepared before the hearing, every document and decision that pertains to the hearing is reviewed with a fine-tooth comb, and all appeals are submitted as warranted.

When we handle your unemployment claims hearings, you can be certain that we’ll get the absolute best outcome possible.

Detailed Education, Training, and Support

We’re proud that we don’t just offer a suite of industry-leading software tools– we offer our team to deliver details education, training, and support that is custom-tailored to each unique situation.

We believe in an interactive approach that will help the right members of your staff learn key information and skills in various areas that will help your business.

As we train your team, you’ll see what we’ve learned that the first line of defense when it comes to controlling (and potentially lowering) unemployment costs is having strong HR policies in place.

Our experts will educate your team on the following procedures and practices:

  • Documenting unemployment claims properly and thoroughly
  • Adhering to all state and federal compliance
  • Acquiring strong win ratios using proven principles
  • In-depth problem prevention to stop unemployment claims issues before they occur
  • Performance management overall
Proven Solutions Powered By Advanced Technology

That’s our motto here at Quentelle. Because we truly believe in putting proven solutions powered by advanced technology at your fingertips.

When it comes to staying on the cutting edge of unemployment claims management services, we’ll deliver tomorrow’s technology today.

Let us show you why here at Quentelle, our motto is smart and simple. Schedule a demo now and let’s talk about how our state-of-the-art unemployment claims management technology can change the way you do business, and drive down costs.

Let’s talk today.

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Your Guide To Work Opportunity Tax Credits

Your Guide To Work Opportunity Tax Credits

The Work Opportunity Tax Credit (WOTC) is a federal tax credit provided to employers under the Internal Revenue Code, Section 51, which is administered jointly by the Department of Labor and the IRS. The purpose behind WOTC is to encourage employers to hire job seekers who are experiencing difficulties in finding employment. When an employer hires someone from the WOTC target group, they can claim this tax credit.

What Is the WOTC Program?

Under the Consolidated Appropriations Act of 2021, the WOTC program has been authorized until December 31st, 2025. This means the tax credit for employers is available for wages paid to qualified workers that are employed on or before this date. To claim the credit, employers are required to apply for a certification to the designated workforce agency in their state, which will verify that the newly hired worker belongs to one of the targeted groups.

Once the taxable employer has obtained the necessary certification, they are eligible to claim the work opportunity tax credit as a general business credit. The credit will apply against the employer’s income taxes. Tax exempt employers claim the WOTC federal tax credit against their payroll tax.

A Brief History of the WOTC Program

The Work Opportunity Tax Credit (WOTC) program was launched on October 1st, 1996 to give tax incentives to for-profit employers that would provide employment to qualified individuals from certain targeted groups with historically high rates of joblessness. In addition to the economic goals, the program had a goal to incentivize workplace diversity. Since the introduction of the program, the WOTC has been extended and modified a number of times. In 2006, a similar but separate credit for the recipients of long-term welfare was merged with the WOTC. The program expansions in recent years have led to the total cost of the WOTC to exceed $1 billion.

How Does WOTC Work?

How Much Is the Tax Credit for the WOTC Program?

In general, the Work Opportunity Tax Credit is equal to 40% of up to $6,000 of a qualified worker’s wages, or the wages incurred on their behalf. A qualified individual is someone who is:

  • A certified member of one of the target groups.
  • Currently in their first year of employment.
  • Working for the employer to provide service for at least 400 hours.

At the rate of 40% for a maximum wage of $6,000, the maximum amount of tax credit is typically $2,400. For workers who perform services for at least 120 hours, but less than 400 hours, the applicable rate is 25%. For some qualified veterans, wages of up to $24,000 would be considered for calculating the WOTC.

If a worker has been re-hired, the employer may not claim the WOTC for them. Generally, the employer is allowed to carry the unused WOTC for the current year back one year and thereafter forward up to 20 years.

Who Qualifies for WOTC Credits?

The tax credit WOTC program is available to employers that are for-profit or tax-exempt as long as they hire job-seeking individuals (who consistently faced significant barriers to employment) from one or more of these 10 targeted groups:

  • Qualified veterans
  • Qualified veterans with disability
  • Qualified veterans who are unemployed
  • Qualified ex-felons
  • Qualified recipients of TANF (Temporary Assistance to Needy Families) formerly known as AFDC (Aid to Families with Dependent Children)
  • Qualified recipients of vocational rehabilitation
  • Qualified recipients of SNAP (Supplemental Nutrition Assistance Program), formerly known as Food Stamps
  • Qualified recipients of SSI (Supplemental Security Income)
  • Qualified recipients of long-time family assistance
  • Qualified recipients of long-term unemployment

How Does My Business Participate in WOTC to Claim Tax Credits?

Taxable as well as specific tax-exempt employers of all sizes are eligible to participate in the WOTC program. Before an offer of employment is given (or on the day the offer is made), the job candidate as well as the employer are required to complete Form 8850, which constitutes a formal request to claim WOTC.

From the date the new employee begins work, the employer must submit Form 8850 within 28 days to the designated state agency’s local office (state workforce agency in the location where the employee works for the business). The Department of Labor may require additional forms to provide the certification.

Once the employer receives a certification from the local agency confirming that the employee belongs to one of the target groups, the taxable employer should complete Form 5884, while the employer who is tax-exempt will complete Form 5884-C to claim the WOTC.

Wages to Be Considered for Tax Credit

After a worker has been hired, it is important to determine the exact amount of wages that must be counted for WOTC for that worker. In order to qualify for the tax credit, the wages should have been paid in the worker’s first year of employment. Secondly, the worker should have completed at least 120 hours on the job during the first year. In other words, the employer must wait until a worker has accumulated 120 hours of work before filing for the credit.

All payments that the employer has made to the worker during the covered period can be included. The following aspects must be complied with:

The “wages” should be wages on which the employer has paid out federal unemployment tax. The business should have directly paid those wages. If the wages were paid by the business indirectly or were subsidized through a third party, those will not be considered towards the Work Opportunity Tax Credit.

If the worker has completed at least 120 hours on the job in the first year, the employer can claim WOTC of 25%. If they have worked for a minimum of 400 hours, the tax credit of 40% can be claimed. For all types of employee categories, there are different limits of maximum hours for which tax credit can be claimed.

It is noteworthy that the worker wages that have been used to determine eligibility for WOTC cannot also be used for calculating other types of worker tax credits, such as Medical Leave Credits, Paid Family and Medical Leave, Employee Retention Credit, or forgivable loan proceeds under the Paycheck Protection Program.

The Procedure to Apply for WOTC

After the employer has hired an employee, and received a letter from the workforce agency in the state confirming that the employee qualifies, the employer can claim WOTC by submitting an IRS form depending on the type of business. The form to be completed and submitted is as follows:

  • IRS Form 5884: If the employer’s firm is a partnership, trust, S corporation, estate or cooperative, they should submit this form.
  • IRS Form 3800: All other business owners and taxpayer employers may submit this General Business Credit form.

To complete this form, the employer must calculate the cumulative wages of qualified employees, based on their employee category and the number of hours worked. This figure should be multiplied by the total number of hours an employee has worked during the year. Thereafter, the appropriate percentage (25% or 40%) must be applied to the final figure. The complete form will be added to the employer’s tax return to compute their individual or business income tax liability.

WOTC Screening

Employers use the WOTC screening process to determine whether a potential new employee may qualify for inclusion in their tax credit calculations. They will consider whether the potential hire belongs to the qualifying category of employees and, in any case, after getting hired the employee should be able to meet the requirements for the minimum number of hours worked.

The job applicant and the employer must complete and submit Form 8850, which is the state workforce agency’s pre-screening form. In addition, Form 9061 from the Department of Labor must be submitted in order to be eligible for the federal tax credit. Once the state workforce agency determines that the worker is qualified, the next step for the employer is to apply for the tax credits to the IRS.

The Impact of WOTC on Business Taxes

Businesses can apply the WOTC to their tax liability for the particular year, along with any other tax credits. The credits must be applied in a specific order. The appropriate tax form to be submitted for claiming the WOTC will depend on the type of business. “Pass-through businesses” where the business profit or loss is passed through to the business owner should include the WOTC application on Form 1040. The maximum amount of tax credit under the WOTC program is limited to the amount of income tax liability of a business or the Social Security tax owed.

How Does the WOTC Affect the Employee?

Employees that qualify under the WOTC program do not receive any financial benefit for being a part of a special category. However, the potential incentive for the employers improves their chances of getting hired. For every qualified employee, the employer may stand to gain a tax credit of anywhere between $1,500 and $9,600. This may be a significant reason for an employer to hire candidates under the WOTC program.

Advantages of WOTC for Employers

Reduction in Federal Income Tax Liability

By making use of the Work Opportunity Tax Credit benefits, an employer can lower their company’s federal tax liability by a substantial extent, or even eliminate it entirely in some cases. However, it’s crucial to remember that the amount of tax credits cannot exceed the total amount of income tax liability of the business.

If the employer does not have any income tax liability, they may still apply for the WOTC. Unused tax credits are allowed to be carried back 12 months as well as carried forward for up to 20 years on future tax returns. This means the employer can use their tax credits at a future date, once they have a corporate income tax liability.

Reduction in the federal tax liability can significantly bring down the costs of doing business for an employer. The savings achieved through the WOTC program could be utilized for business expansion or to finance the company’s core business operations.

Improvement in Cash Flow and Profits

By some estimates, an employee hired under the WOTC program can help boost the business profitability by up to 80% when compared to an equivalent non-qualified employee. With a lower tax bill, the company’s cash flow can improve and there can be a positive impact on the company’s profitability bottom line.

No Restriction on the Number of WOTC-Qualified Workers

The WOTC program imposes no limits on the number of qualified employees that an employer can hire for the purpose of gaining tax credits. No matter whether a company hires 5 or 500 eligible workers, their WOTC tax credits will continue to accumulate and strengthen the financial position of the business.

Large Number of Candidates Are Potentially Eligible

Even if a business has never participated in the federal WOTC program before, there is a fairly high probability that they already have employees or may hire new candidates that qualify under this program. In general, about one in five new employees are eligible for this tax credit in most industries. The qualifying rate may be even higher in certain industries.

The Department of Labor data shows that in 2018, the number of new hires under the WOTC program was 5.6 million. Consider the average rate of WOTC eligibility of about 20%, it amounts to nearly $2.5 billion in tax credits for that period that taxable employers could claim.

Businesses Should Recognize the Benefits of Participating in WOTC Program

According to market analysts, less than 50% of eligible employers participate in state or federal incentive programs, such as Work Opportunity Tax Credit. Although the pandemic increased the trend of companies taking advantage of government-backed initiatives to support business, many companies continue to miss out on the potential leverage they can gain from tax credit programs such as WOTC.

Lack of knowledge as well as lack of experience are two primary reasons why companies across all geographical locations may be lagging behind in participation in these programs. At the top management level, many business decision makers express unawareness about whether their company is utilizing the tax incentives such as WOTC. Some business owners say that they are unsure whether their company qualifies for these benefits. This reflects a significant lack of awareness that results in missed opportunities for qualifying businesses.

While at the outset, it may appear that the WOTC program involves complicated procedures to take advantage of the tax incentives, the advancements in automation and customization of services by firms such as Quentelle have made it much easier and faster. When companies team up with Quentelle to maximize their WOTC advantage, it will likely improve their profits consistently year after year.

It is worth it for companies to check through their HR departments to find out whether they qualify for WOTC benefits. An appointment with one of the knowledgeable team members at Quentelle can help business decision makers – including managers, CEOs and business owners – understand how technology can make the WOTC process simplified, compliant, and cost-effective. The message from Quentelle is clear – no business should miss out on tax credits just because they did not seek the professional opinion from a specialist.

How to Increase Employer Participation in WOTC with Quentelle?

From an employer’s perspective, maximizing WOTC benefits can be a time-consuming process. To stay compliant and to make the most of the program, the employers are required to deal with a number of challenges, including completing thorough paperwork, keeping diligent records, monitoring wages and hours worked, meeting the state agency deadlines, preparing meticulous documentation to support the WOTC claims, and accurately computing and recording the tax credits.

To complete this entire administrative process in-house, the employer may have to allocate considerable time, resources, and talent. Employers are often reluctant because getting involved in this process may distract their teams from the core business activities. However, there is a practical solution to avoid the complexities related to WOTC tax credit handling, and stop losing out on significant tax credit benefits.

By partnering with Quentelle, employers can relieve their in-house HR teams from the burden of WOTC administration and streamline the complete process using Quentelle’s automated platform. This enables an employer to maximize their legitimate tax credit opportunities without compromising their core business activity and without increasing their staff or administrative expenses.

The Quentelle platform not only speeds up the process to ensure the state agency submission deadlines are always met, it also improves the accuracy of information and documentation to ensure full compliance with the federal and state WOTC regulations. Make Quentelle a seamless part of your WOTC tax credit process, and improve your bottom line, while redirecting your own team’s energies towards more productive and creative business operations.

Partner with Quentelle to Boost Your Profits and Productivity

Quentelle, in conjunction with the leading tax credits specialist Walton, has created a win-win for employers to maximize their tax credits, while diversifying their workforce by hiring employees that qualify for the WOTC program. Employers who otherwise might be reluctant to hire workers from certain eligible categories for various reasons can have the opportunity to gain in tax credits when they utilize the benefits of WOTC by teaming up with Quentelle.

Many employers are increasing their profitability and cash flow and saving millions of dollars in business tax liability by participating in the WOTC program. At the same time, providing employment to eligible workers from the disadvantaged categories helps strengthen the company’s value system and work culture, improves employee morale, and bolsters the company’s reputation as a socially responsible organization.

With the cutting-edge digital platform technology from Quentelle, WOTC is no longer a paper intensive, cumbersome, and time-consuming process for employers. Quentelle’s advanced solutions from Walton have simplified the entire process, while making it faster and more accurate at the same time. By partnering with Quentelle, a business can leverage the excellent WOTC benefits and improve their productivity, profitability, and cash flow.

Overcome the Hurdles to WOTC Benefits with Quentelle

Is your organization missing out on potential WOTC benefits because it is unwilling to commit in-house resources to this tedious and resource intensive process? Let Quentelle help you make the most of your rightful WOTC opportunity, while freeing up your resources and talent from the onerous responsibilities of filling out and submitting forms within deadlines, preparing support documentation and records, and ensuring compliance with the law.

Considering that the IRS only gives you 28 days for the submission of the required documentation, traditional labor-intensive approaches to WOTC administration can prove to be costly and error-ridden. In particular, when your company is hiring a large number of new workers, completing and tracking the WOTC paper trails can be even more daunting. This is where Quentelle, in partnership with Walton, is helping employers replace their manual in-house WOTC process with its automated platform service.

Quentelle’s professional support and service for WOTC tax credits begins with the introduction of a small questionnaire as part of the hiring process to identify all the eligible candidates. The automated screening and onboarding process with the digital platform capabilities of Quentelle lets your company eliminate the burden of in-house identification and processing of tax credits. This reduces the demands of time and effort on your HR teams, while ensuring that your business enjoys maximum tax credit benefits.

Let Quentelle Turn WOTC to Your Business Advantage

Ever since the WOTC program came into existence in 1996, it has continually evolved and gained acceptance as a useful tool to promote more equitable job creation, while rewarding employers for their participation in this endeavor. Companies of any size can be eligible to receive Work Opportunity Tax Credits. There is no cap on how much an organization may earn by way of WOTC, as long as it does not exceed their income tax liability.

Employers that were hesitant in the past to make use of this federal government-backed incentive because of the administrative hurdles involved are now joining hands with Quentelle to make the most of the WOTC program. With Quentelle’s digital platform and automation of the WOTC process, you no longer have to worry about missed tax credits, high error rates, delays in submission of forms and documents, and dissatisfied HR staff burdened with a manual process.

With the platform capabilities of Quentelle to streamline the administrative WOTC process, it is easy to efficiently capture and maximize tax credits where you are eligible while staying compliant with the ever-changing regulatory requirements. When you partner with Quentelle, your organization will begin to generate significant tax savings, which you can channel to more productive areas of your business to gain a durable competitive advantage.

Here are some of the key benefits of automating the WOTC tax credit process with Quentelle:

Cost Reduction

When you perform the administrative tasks related to WOTC tax credits in-house, you have to hire skilled staff dedicated to perform this process. This can significantly increase your HR expenses. On the other hand, when you move your tax credit management and handling responsibilities to Quentelle, you get access to industry-leading technology, streamlined business processes, and significantly lower costs.

This is possible because the experienced professionals backed by the automation platform capabilities of Quentelle can perform the same tasks much faster, more accurately, and at a lower cost to your organization. Moreover, you will also save money because you no longer have to make continued investments in updating and maintaining the internal infrastructure needed to carry out the same tasks in-house.

Higher Speed and Accuracy

With the cutting-edge digital systems of Quentelle along with a team of trained professionals, the time taken to complete forms and paperwork, prepare support documents, and track and store employee data is substantially cut down. When the entire WOTC process is handled in-house using traditional methods, it becomes far more time-consuming, taking away the focus and attention of your teams that could otherwise have been utilized for core business activities.

When employers try to cut down the time spent on the tax credit process in-house, it is likely to cause higher dissatisfaction among the responsible HR teams. At the same time, the risk of errors increases when there are tight deadlines to be met. With Quentelle, you get the advantage of speed combined with accuracy. The automated system makes the manual and repetitive processes much faster, while the trained WOTC experts minimize the chances of errors because they are updated with the latest changes in regulations and stay current with the process.

Customized and Reliable Services

As a customer-centric platform, Quentelle is committed to helping your organization meet its unique requirements related to tax credits and other peripheral items. It has the agility and flexibility to tailor its services and adjust them to your changing business needs. This flexible approach lets you utilize Quentelle’s services based on your current organizational demands. This provides you superior cost efficiency to achieve maximum financial benefit.

Reliability is one of the high points when you choose a top-rated platform such as Quentelle. The company follows industry best practices and has put in place robust systems to enable timely communication and reporting, and to deliver fast, secure, and satisfactory outcomes for all customer requests. Because the teams at Quentelle are specialized in the tasks they perform, they can ensure high-quality performance and full compliance with the regulatory requirements.

What Does WOTC Mean for My Company’s Human Resources Infrastructure?

The WOTC program is valuable for any eligible employer not just because it can help improve the business bottom line, but also because it bolsters the company’s human resources infrastructure and its reputation as a responsible employer. Used correctly, WOTC has the potential to strengthen the objectives of inclusion and workplace diversity in a business organization.

Employee morale is often higher in organizations where people are hired from the widest possible cross-section of the available talent pool. Worker turnover rates are reduced and productivity per employee is likely to improve in these organizations. Moreover, when the employer includes a WOTC survey as part of their application process, the HR team can gain better insights into the opportunities for diversity and multiple skill sets and experiences that may be available.

What Should I Look for in an HR Platform that Integrates WOTC Functionality?

As an employer, you need a proven and established service provider with an advanced HR platform that fully integrates WOTC functionality. The integration will streamline your HR process, minimize the scope for errors, and deliver faster and more cost-effective results. Choose an HR platform that is intuitive, user-friendly, and is designed to make the WOTC integration incredibly simple.

Top-Rated WOTC Solution Provider

Quentelle, through its partnership with a leading employment tax credits provider Walton, provides a streamlined solution that makes the task of screening Work Opportunity Tax Credits easy and efficient. When you administer a short, but proven questionnaire as part of your organization’s process of hiring or onboarding, it enables Walton to quickly and accurately determine eligibility and pursue WOTC and other tax credits for your business.

Simplified Screening, Unmatched Results

Quentelle makes the screening process simple by leveraging the power of Walton. Walton utilizes a number of integrations with dedicated Applicant Tracking, Job On-Boarding, and Payroll Taxes service providers. This gives Walton the ability to automate the WOTC screening process and deliver a fast and friendly user experience while optimizing results. With support from Quentelle and the cutting-edge solutions from Walton, you can increase your tax savings, ease the workload of your team, and strengthen your human resources infrastructure.

Partner with Quentelle for Winning HR Tech Solutions

Is your company spending too much time and effort trying to navigate the Work Opportunity Tax Credit (WOTC)? Let Quentelle do the heavy lifting for you and help you achieve superior operational efficiency in multiple HR tasks with our award-winning technology platform. A growing number of companies are choosing Quentelle’s suite of proven and innovative solutions. To schedule a demo, call us at (888) 565-5515 or simply fill out this online contact form and we will respond as soon as possible.

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The Best Practices In Employment Verification

The Best Practices In Employment Verification

Employment verification is an important part of the modern employment landscape. In this article, we’re going to provide you with a robust guide for your business so you can understand what employment verification is and get some insights as to how the employment verification process works.

Additionally, we’ll provide some insights as to how you can use background screening properly within the allowed regulations, and provide details on how you can optimize your verification process. We’re excited to show you the role that a thorough screening process can play in your business, no matter if you use it for HR purposes, income verification or KYC (Know Your Customer) functions.

The Basics of Employment Verification

Let’s review some of the basics of employment verification and background checks for companies, how they came to be, and the role they can play in the employment verification process.

What is Employment Verification?

Simply put, employment verification is a way for employers, institutions, and individuals to double-check and confirm employment information provided to them by an individual. There are varying degrees of employment verification, and some are more rigorous and formal than others.

If your company isn’t using a formal method for employment verification, you are very likely at risk. While it’s not something we like to think about or admit, we have to face the fact that many people aren’t 100% forthright on their resumes or other loan applications.

The things that people are dishonest about about can vary greatly. Some common things that we find are misrepresented are the length of time people were employed, the number and type of positions people have, their overall qualifications, and titles.

When you rely solely on the information you receive from the individual that you are processing a job application or loan for, you may not want to bet your company’s future on information that you have no way of truly verifying. This can be especially problematic if you’re trying to draw up a risk profile for loan verification or determining qualifications for a mortgage program. This is where a verification of employment solution comes in.

Employment verification is a specific type of background check that attempts to vet all of the information that an applicant provides prospective employers or lender. Rather than pulling these details at face value from a loan application, resume, personal website, or LinkedIn page, the information gathered during a properly conducted employment verification process can be fully trusted as accurate.

How Does Employment Verification Work?

So you’re considering using employment verification services for your business, but before you do, you want to be more clear on how it all works. Here are some of the details of how the process works (and why you probably shouldn’t try to handle this on your own).

Remember, there are two sides to this coin– there are applicants that you will be seeking employment verification for, but there are also companies, lenders, and individuals also seeking to verify one of your employee’s work history as well, especially in processes such as mortgage applications or business loans. Let’s look at both of these scenarios to see how employment verification can work.

Seeking Verification of Employment for Applicants

Firstly, it’s critical that you keep in mind that you can’t conduct any background checks in secret. When doing any sort of employment verification checks, the Fair Credit Reporting Act (FCRA) requires that person’s express permission, in writing. Therefore, you must be careful and use the correct written consent form, as there are certain criteria that are legally required.

Typically the employment verification can begin once the individual you’re checking up on signs off on their formal waiver.

From here, we highly recommend using a partner like Quentelle to handle the rest to save you hours of time and protect yourself.

From here, in many cases, the manual contact of each person on a person’s resume is necessary. Note that if you or your human resources department is handling this, it can be time-consuming and ongoing.

When attempting to verify employment, you’ll want to check for some key pieces of information. Remember that there are laws and regulations about what you’re permitted to ask. Some of the primary pieces of information you’re looking for are:

  • Did this person actually work where they said they did?
  • Did they hold the title and have the responsibilities they claimed to have?
  • Did they work at each company for the amount of time and the specific dates stated?
  • Are they eligible for rehire?

Note that in certain states, there are regulations about what you’re allowed to ask and what information can be shared. For instance, in some cases, asking about an employee’s previous salary and the reason why they are no longer employed are fine, and in other cases, it is not.

Replying to Verification of Employment for Current Employees

There are a variety of reasons why you might receive a request to verify a current or former employee’s current role at your company (we’ll go over these in detail later).

It’s often seen as good form for your company to let the employee in question know that you’ve received a formal request for their employment details. This is not only professional but also a good way to check the legitimacy of the request quickly.

No matter what, be 100% certain to verify the request before you give out any details regarding a past or present employee’s information.

Once you’ve verified the request and you’re sure it’s legitimate, you have to decide how you’re going to provide the verification. Sometimes the inquiring company will have a specific format they’re requesting (such as a standardized form), and other times the choice will be up to you.

A popular way to verify employment for someone is with a proof of employment letter. Usually printer on company letterhead (which proves your address and info), the letter typically includes important details about the employee such as their title, the dates they worked for you, and in some cases their duties. You should also include the best ways to contact you in the event they have further questions.

Outside of a letter, some other methods of proving employment are employee paystubs, and any agreements or contracts (typically for freelancers).

What About Defunct Companies?

If the company that you’re trying to contact for your pre-employment background screening is no longer in business, there are still ways to confirm these details. Paystubs, W-2 tax forms, and other documents will all prove that an employee worked for a company.

Employment Background Checks are Time Consuming

As you can see, whether you’re verifying the employment record of an applicant your company is considering bringing on board or helping a past or current employee verify their employment with your company, this is a time-consuming process.

More on this later, but we’d be remiss if we didn’t mention that you should consider using a company like Quentelle to save time, reduce administrative costs, and protect yourself.

So what is it that we need employment verification, and how did it come to formally exist?

Why Do We Need Employment Verification and Why Does it Exist?

The reason that employment verification exists is so that employers can have a proven and confirmed record of a person’s job history and other details. Why?

Well, it’s not only to make sure that the person they’re hiring has the qualifications they claim to have but also because, at the root, a company is responsible for the actions of its employees.

Let’s say that an employee of your company engages in criminal behavior. Did you know that your company could potentially be accused of negligent hiring? And did you know that if accused, your company can also be required to appear in court and potentially be held responsible for punitive damages?

That means that not only would you likely be paying for expensive legal fees, but you also may have to pay money as compensation for something one of your employees did.

Employment verification helps companies mitigate risks when hiring employees. Rather than taking someone’s word alone, employers can also use a clear and verified work record and background check to see if they have prior criminal activity (as well as other important details).

When your company uses background checks and verification of employment as part of its hiring process, you’re letting all of your current employees know that you care about your company’s culture and reputation.

So Where Did This All Start?

If you want to get technical, we can reach as far back as 1908 to see a case where an employer was held responsible for an employee’s actions, and it cost them dearly. In a machine shop in Corbin, Kentucky, an apprentice played a practical joke with a compressed air hose that killed a fellow employee.

This wasn’t an isolated incident, and management never stepped in. So even though the apprentice in question continued to act in a way that was careless, reckless, and unfit, he was still allowed to work in the machine shop.

Because the machine shop let the man continue reckless behaviors during his employment that resulted in a death, the machine shop was ultimately held responsible for the death themselves.

This case set a legal precedent, and throughout the years the matter of an employer’s accountability for employee actions has had several surges.

As recently as 2008, another crucial reason for employment background checks came into play– a massive economic downturn that resulted in a national financial crisis. Until 2010, lenders had no employment screening services in place. This meant that lenders weren’t required to verify or document employment for the people who were borrowing.

Unfortunately, this meant that loans were being granted based on people’s personal judgments and some predatory lenders in the financial industry.

With the creation of the Consumer Financial Protection Bureau came the passing of several regulations and laws that now required both the lender and the consumer to work together to prove that the borrower could actually afford the debt.

A specific example is the Ability-to-Repay rule, which states that a lender or creditor must make “a reasonable, good-faith determination of a consumer’s ability to repay” loans according to their terms.

By formally verifying someone’s employment, lenders can accurately determine if the person applying for the loan is creditworthy, and also lowers the risk of fraud.

Through the years, technology for performing background checks and employment verification has changed, but the core reasoning behind them has not. Whether you’re an employee or a lender, when you use employment verification and background checks, you’re protecting yourself, your employees, and your business as a whole.

Employment Verification and HR Platforms

Employment verification has many uses. Many companies, individuals, and organizations use these sorts of specific background checks. Requests could be from a company looking to hire a potential applicant, a landlord who is looking to rent out their property, or a financial institution looking to qualify a borrower.

Remember that employment verification isn’t only used for a company’s hiring process, it can also be used by other organizations for various– but important– reasons. No matter the reason, the accuracy and regulations of employment background checks are critical. Here are some of the use cases for employment verification.

Common Employment Uses

Hiring an Applicant: employment verification can be used to double-check the validity of what a potential employee put on their resume.

Verifying a Salary: In some cases, a company that is hiring an employee may want verification of the salary the applicant is currently making before formally offering them a specific amount.

Common Financial Uses

Verification Prior to Loan Approval: Nowadays, when you are formally applying for a loan, some sort of employment verification is required. This information is key so that lenders know that your income will allow you to make the payments necessary to keep your loan current and in good standing.

Verification for Rentals and Leasing: Apartment companies and property managers will typically use background checks to verify an applicant’s employment. In some cases, they’ll want to double-check monthly income to ensure the rent/lease payment is feasible.

How Automated HR Platforms Have Changed Things

For many years, companies only had a few limited choices when it to how they would handle their background checks. There was also not a lot of emphasis on privacy and security of information. That is no longer the case in the current place we’re in technologically.

Automated human resource platforms have taken much of the paper and pen work that HR departments were doing manually and moved it into the cloud. And if you choose the right platform (such as Quentelle), you’ll be able to handle many of your verification requests automatically. When this automation is in place, much of the heavy lifting of employment verification is removed from your HR staff. This will keep them from staying busy with the shallow, ongoing work that these employment background checks can be.

If you choose the right partner, with this verification automation also comes robust reporting so you’re never in the dark about any requests that are coming in.

Additionally, proven HR platforms are far more secure than traditional means. Not only will employer and employee information exclusively be shared over secure and encrypted channels, but through electronic signatures, the information will only be shared with the correct parties after documented employee approval has been logged.

Beware of FCRA Laws and Regulations

When it comes to background checks and employment verification and any financial applications, it’s critical to keep the Fair Credit Reporting Act (FCRA) in mind. So what is the FCRA, and what does it mean to show compliance?

The FCRA is in place so that all employers are required to conduct all of their background checks fairly. It seeks to ensure that all inquiries are not only fair and accurate for consumers, also but as transparent and thorough as possible.

If you’re not careful and don’t familiarize yourself with the specifics of the FCRA, your business could be in danger of a lawsuit.

So what constitutes an FCRA-compliant background check? The organization that handles this is the Federal Trade Commission (FTC), and they have a set of guidelines that are your responsibility to follow as a business.

Firstly, your employees have a right to know about the background check. They also need to provide explicit consent for the background check, and they also have the right to review any of the information that relates to their financial and personal information.

Additionally, if they feel there are things on their background check that are inaccurate, they have the right to attempt to correct them. Further, they also have the right to appeal any decisions if they feel they were treated unfairly based on the information that their background check reveals.

Before You Request a Background Check

Be sure you provide written notice to any applicants explaining that you plan to use info from their consumer report to possibly make hiring decisions. This has to be a standalone notice (not part of a job application). You’ll need direct written permission to access this person’s consumer information.

Before Making Decisions Based on a Background Check

If you decide not to hire someone because of what you learn in a background check, you have to take certain actions before you choose not to hire them, promote them, or take other negative actions regarding employment. First, you have to give the person in question a copy of the information you used to make your decision. You also have to provide a copy of a summary of the person’s rights under FCRA (obtained from the FTC). You also need to give them a reasonable amount of time to look over everything you sent and contact you if there’s any information you’d like to dispute. You can find more information about FRCA from the equal employment opportunity commission here.

After You Make Decisions Based on a Background Check

If you give the person in question time to respond and still decide that you aren’t going to hire them, give them a promotion, or perform other negative actions based on their background check, you have to let that person know. Typically this must be done in writing, electronically, or verbally. When you do this, you must use a specific form called an Adverse Action Notice. This allows them another chance to correct any inaccurate information.

These notices are nuanced and have specific details that need to be included when you send them. They must include the person’s right to refute their accuracy or correct any information that is wrong or incomplete. Additionally, a statement must be included that says that any background screen service used didn’t decide to take “adverse action” and cannot give specific reasons for this decision. Finally, you have to include the specifics on which consumer reporting agency you obtained the report from.

An Important Note About FCRA Compliance: Remember that the information included in this article is intended to be helpful and is not an exhaustive guide on the topic of the Fair Credit Reporting Act. This guide should not be construed as legal advice. We’d love to talk to you if you have any questions about how you can navigate the FCRA.

Equal Employment Opportunity Commission

Compliance is very important when it comes to the FCRA, but it doesn’t end there. You also need to consider the guidelines that are viewed by the Equal Employment Opportunity Commission (EEOC). These guidelines are in place to minimize discrimination.

For instance, you’re not allowed to check certain criteria of a person’s background when it comes to things such as age, race, nationality, the color of skin, gender, beliefs, or disability. In fact, in some cases, you may need to make concessions if it comes to light during a background check that certain problems are present due to a disability.

You’re also not permitted to make decisions based on any profiling of any kind, or to avoid challenges that you perceive to be more common in certain groups of people.

In the eyes of EEOC, you must be able to prove that you are applying the same standards to everyone as equally and fairly as possible.

Overall, the best way to protect yourself is to have the same criteria for screening every individual no matter who they are.

Employment Verification Best Practices For Employers, Government Agencies, and Financial Institutions

Put in the Effort: Unless you hire a company like Quentelle, handling your own employment verifications is often time-consuming and no small task. You’ll have some verifications that are easier than others, but there are also some (maybe most) that are going to take much more time and effort on your behalf. When you do hit one of the tougher verifications, be sure that you do all you can. We recommend four or five attempts, and each attempt is counted when you reach out to the correct contact using one of the following contact methods: phone, email, letter, or even fax. We also recommend alternating methods (first call, then email, etc.) to maximize your chances of getting a hold of someone on different mediums. It’s always the best idea to make notes each time you attempt to contact someone for verification so that you can also show when you tried and the method you used should that information come into question.

Decide Your Timeframe: Some resumes will go back a decade, two decades, or more depending on the age and work history of the applicant. Decide for yourself how far back you want your standard check to include. By choosing a standard amount of years– say 5– that you’ll verify, you’re approaching each employment verification with a level of fairness. The last thing you want when you’re background screening is to accidentally leave yourself open to what could be construed as discrimination by treating applicants differently. When you decide the amount of time you’re going to use during your own personal screening process, stick with it, and you’ll not only get better results overall, but you’ll show that you’re being fair to those that you’re screening.

Don’t Assume Current Employers Are Expecting Your Call: Candidates who are seeking to work for your company may not have told their current employer that they’re in the job market. This is why it’s so important to gain clear written or verbal consent from each applicant. You don’t want to jeopardize the employee’s opportunity to personally make their current employer aware that they are planning on leaving. In some cases, this can cause tension in the workplace for the applicant, and in some extreme scenarios cost them their employment sooner than they were planning.

Can’t Get Through? Do Some Research: If you’re having trouble reaching a specific company or contact in your pre-employment background screening, it’s easier than ever to do some digging yourself online. Perhaps the company you’re trying to reach has had some changes recently. Remember that phone numbers and extensions can change, people transfer or are promoted or move on, emails change, and companies even change their primary URLs. With all the different avenues available such as Google, LinkedIn, and corporate sites, it’s likely you can get the updated information easily if you take a moment to search.

Deeper Searches for Certain Sectors

For various industries and sectors, employment verification is more critical than others. For example, when it comes to banks, financial institutions, and government agencies, a keen eye for detail is needed. Go deeper to ensure that you’re secure, and the candidate you’re considering is the best fit.

For example, verifying dates and titles may not be enough. Consider asking about any prior issues with performance, or if there were any specific essential skills needed to perform their specific job. Also, you can directly ask about work ethic related to their previous position and what was needed to find success in the role.

What about gaps in employment? How many are there and how long were they? Also, don’t be shy– if information that an applicant has provided you isn’t lining up, don’t be afraid to explicitly ask about details. Don’t be afraid to ask questions and dig deeper. You may find that the applicant in question is showing unethical behavior by misrepresenting key details to give a certain impression that isn’t expressly accurate.

Your aim here is to be sure that you are confidently hiring the employee that you think you are and are fully informed.

Quentelle is the Gold Standard in Employment Verification

Not all methods of employment verification are created equally. We’re able to deliver a best-in-class screening process to companies of all sizes– from start-ups to Fortune 500 businesses. We’d love to show you why we’re the industry leader in a full range of any employment verifications you might need.

Not only will you save time and administrative costs by using our turnkey automated system to handle all of your employment and income verification, but you’ll also allow your human resources staff to focus on other facets of your business.

When it comes to employment screening services, we offer the state of the art in security and compliance. Our dedicated focus on data privacy and security is second-to-none, and we adhere to FCRA compliance, have SOC I & II certification. In addition, we not only use at-rest encryption and proactive threat screening but also use masked PII for the ultimate in data security and privacy.

Companies like yours choose our platform for their pre-employment background screening for many reasons, but one of the most common is because our software is as simple to use as it is powerful. We take the absolute very best in background check services and deliver it to you in one simple platform.

Additionally, if you have any questions about our platform at all we have a dedicated staff who is here to help. Everyone on our support team is highly-experienced and is expertly trained on our platform. No matter what your question may be, our unmatched support team will handle all inquiries quickly.

Let us show you why here at Quentelle, our motto is “smart and simple”. Schedule a demo today and let’s talk about how we can help your company with its pre-employment background screening needs.

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UI Claims and Your Business

UI Claims Processing – Unemployment Insurance Claims and Your Business

Unemployment Insurance (UI), otherwise known as unemployment benefits, refers to an insurance provided by the state to make weekly monetary payments to eligible individuals if they have lost their job. Someone who voluntarily quits the job or gets fired because of a justified reason may not be eligible to claim UI benefits.

Although unemployment claims insurance operates under federal law, states have the mandate to administer their own respective UI programs. The state governments have the primary responsibility to pay the unemployment insurance benefits, which they finance through the collection of certain payroll taxes.

Determining Eligibility

The person who wants to claim UI benefits should be eligible according to the guidelines set by their state. In general, you are eligible for unemployment insurance benefits if you:

Lost your job without any fault of your own

This typically means that you were separated from the job because of the unavailability of work.

Meet the requirements of work and wage

You should be able to meet the state requirements for the time worked or wages earned during the base period (the established time period of employment). In most states, the base period is generally the first four completed calendar quarters out of the last five prior quarters to the time you filed the UI claim.

Meet additional requirements imposed by the state

You must find out the specific additional requirements that may be included in your state’s UI program.

End-to-End UI Claims Process from an Employer’s Perspective

As an employer, your responsibility in the unemployment claims process begins from the moment you hire an employee, not from the time they leave the job. After hiring new employees, you must report this information to the state. You are required to pay state and federal unemployment taxes for every employee working for you. The UI program of your state is funded from these taxes.

State Unemployment Tax Act or SUTA is usually an employee-only tax, but employee contributions may also be required under some state UI programs. Federal Unemployment Tax Act or FUTA is at present an employee-only tax. Each state will determine its own wage base and the tax rates will also differ for each state.

Employers are not required to pay an unemployment tax on the payments made to independent contractors because they are not qualified to claim unemployment benefits.

What is Required of the Employer When a UI Claim is Filed?

What is Required of the Employer When a UI Claim is Filed

When an ex-employee files an unemployment benefits claim, the state will send you a notice. This “Notice of UI Claim Filed” is only sent to the most recent employer of the said employee. As an employer, you will indirectly pay for your former employee’s unemployment insurance claim through your payment of SUTA and FUTA taxes.

The state will charge these benefit payments to your employer taxation account. The higher the volume of approved unemployment claims in your state, the higher your contribution to unemployment taxes will be. However, exceptions may be made in special circumstances. For instance, in some states, any mass layoffs resulting from the Covid-19 crisis may not impact SUTA tax accounts. Details of pandemic-related mass layoff limits may vary for each state.

Covid-19 Layoffs and UI claims

What Steps Employers Can Take in Response to UI Claims

As an employer, you should be prepared to take necessary action after you receive a notice from the state for an unemployment claim. Your response will vary depending on whether or not you plan to contest the unemployment claim. Here is an overview of the employer’s responsibility for contesting or accepting UI claims and the reasons for such action.

Employer Decides to Accept the Unemployment Claim

While filing an unemployment claim, your former employee will provide the relevant information regarding the claim. If the UI claim is legitimate and the information provided by the person is factually correct, you might decide against contesting the claim. Your decision to accept an unemployment insurance claim usually means that no further action is required from your end.

Common reasons for accepting unemployment claims are:

  • You removed the employee because of lack of work.
  • You removed the employee due to financial difficulties.
  • The employee quit or was terminated because of your wrong action.

When you accept an unemployment claim, it does not automatically mean that the claimant will receive the benefits. The state will make the final decision. If the ex-employee’s application is unfit, the state could deny the claim.

The state will send you a determination letter, which informs the reasons for their decision on the claim, and any charges it will make towards your account. If the state has denied the claimant’s unemployment insurance claim, they will have the right to appeal this decision.

Employer Decides to Contest the Unemployment Claim

Depending on the situation, you may choose to contest an unemployment benefits claim. If you win, it can save you on the unemployment tax rates. Common reasons contesting unemployment claims include:

  • You removed the employee due to their misconduct.
  • The employee voluntarily quit to take up a new job that did not materialize.
  • The claim form of the employee contains false information.
  • The claimant was an independent contractor.
  • It is an instance of unemployment fraud.

When you contest an employment benefits claim, you must respond to the unemployment department in your state. Your ability to contest may be forfeited if you fail to respond within the time limit mentioned in the notice.

It is best to support your decision with the maximum possible evidence, which you must submit to the state. Include information related to the reasons for terminating the employee, their period of employment, job title, compensation, and information about the nature of your business. Maintaining payroll and employment records is important even after a worker leaves so that you can provide the necessary information to the state in these situations.

You may be required to attend an unemployment insurance hearing when you contest a UI claim. You may also receive a request from the state for additional information. Once the state makes its final decision, it will be communicated through a determination letter. If you disagree with it, you can appeal the decision within a certain time frame.

Employee Misclassification and Unemployment Claims

Employee Misclassification and Unemployment Claims

The UI claim process may sometimes lead to the issue of worker misclassification. While independent contractors are not qualified to receive unemployment benefits, the classification of a worker as an employee or independent contractor must be followed according to the law in your state. If you misclassify someone as an independent contractor when according to the legal definition of their duties performed they should have been classified as a worker, from the legal perspective:

  • You denied the worker the opportunity to enroll in employee benefit programs, such as retirement plans and health insurance.
  • You denied the worker their right to receive overtime wages.
  • You failed to contribute the required payroll taxes.

Worker misclassification may lead to the imposition of penalties, back taxes, and interest. Your state will demand back payments for workers’ comp premiums and unemployment insurance. Considering these consequences, it is vital to accurately classify your employees from the moment they are hired.

Types of Unemployment Claims

Different types of temporary payments are provided under the unemployment insurance program to eligible individuals as follows:

State Unemployment Insurance

The unemployment insurance program of the state offers unemployment benefits to individuals who became unemployed for no fault of their own (in accordance with the state law) and fulfills other eligibility conditions imposed by the state.

Disaster Unemployment Assistance

Individuals who suffered a job loss or an interruption to their job as a direct consequence of a disaster declared by the US President may be eligible for financial assistance under the Disaster Unemployment Assistance program.

Federal Employee Unemployment Compensation

Former federal employees in civilian jobs who are unemployed may qualify for unemployment compensation under this program if they fulfill all the eligibility requirements.

Ex-Service Members Unemployment Compensation

Eligible former members of the US military can receive benefits under the Ex-Service Members Unemployment Compensation program.

Trade Readjustment Allowances

These benefits provide income support to individuals whose jobs were impacted because of imports from foreign countries and who have already exhausted their eligible unemployment compensation.

Self-Employment Assistance

This program provides an opportunity for dislocated workers to become self-employed through self-employment assistance. The program’s goal is to provide early re-employment.

Unemployment Insurance Extended Benefits

Employees may be eligible for extended benefits after they have exhausted their standard unemployment benefits during conditions of high unemployment.

Pandemic Unemployment Claims

In addition to the regular unemployment benefits, the CARES Act created provisions for additional relief to workers in the backdrop of the Covid-19 pandemic. Under the new law, additional unemployment benefits were offered as part of the FPUC (Federal Pandemic Unemployment Compensation) program. The exact benefits would vary according to how each state decided to implement the provisions of the CARES Act.

Employers should be aware that if one or more of their employees quit because they preferred to benefit from the unemployment compensation offered under the CARES Act, they would usually be considered ineligible for regular unemployment benefits or Pandemic Unemployment Assistance (PUA).

Unemployment Claims Management Services, Automation, and Your Business

A key challenge for employers with regard to unemployment insurance claims is that not only do the regulations vary for each state, but the compliance requirements related to UI continue to change frequently as well. When employers choose to hire the expertise of a dedicated UI claims management services provider, they get the benefits of their focused knowledge, experience, and cutting-edge technology.

The expertise of a resourceful unemployment claims management solutions firm and their automation capabilities will save time and costs, and will minimize the risk of errors while processing unemployment claims. Most importantly, the service provider’s updated knowledge of each state’s UI laws and regulations, and their ability to handle hearings efficiently can help employers remain compliant and minimize their costs of unemployment claims, claims processing costs, and unemployment taxes.

Resolving Claim Challenges Quickly and Proactively

Handling unemployment insurance claims on your own can be complicated for any employer, irrespective of the size or scale of your business. Whether it is one claimant or several, the stakes are always high for the businesses. This is where a highly rated UI claims management expert like Quentelle can save a significant amount of time and money for your business.

Quentelle can quickly deploy all the required skills, tools, and resources to resolve unemployment claim challenges in the fastest, most efficient, and most cost-effective way possible. As an employer, you can focus on your business, while at the same time, have control over the decisions to accept, contest, or appeal the claims and the follow-up strategy.

Auditing Claims to Minimize Errors

Maintaining unemployment claims history and auditing the records to identify potential mistakes is difficult for most companies unless they have a professional claims management service provider that handles everything efficiently. Inability to audit unemployment claims history can be costly for your business because the state department can make errors in their computation, the employer can make overpayment for a claim, or you could be charged at a higher tax rate than you should be.

Employers typically don’t have the systems, expertise, or a dedicated team to address ongoing UI claims and auditing of the claim charges and taxes. With help from Quentelle, employers can receive dependable auditing services. The unemployment cost management specialists at Quentelle can also help businesses put in place new methods and controls to ensure process rationalization and error minimization.

Automation to Drive Higher Efficiency

Advanced automated systems at an unemployment insurance claim management service provider such as Quentelle are designed to make the claims administration process faster, easier, and cost-effective. The latest software-based solutions allow for careful monitoring and execution of UI claims management at every stage and the necessary tax rate verification. At the same time, Quentelle is equipped to maintain the data in a completely secure and confidential manner, while staying compliant with the state and federal data retention and privacy guidelines.

Schedule a Demo with Quentelle

To learn more about Quentelle’s industry-leading solutions for employers, and to explore a win-win partnership that will help navigate the costly and complicated landscape of unemployment, reach out to us today. You can schedule a demo with our unemployment cost management team at a convenient time. Call us at (888) 565-5515 or simply fill out this online contact form and we will respond shortly.

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Verification of Employment and UI Tax

Verification of Employment and UI Tax – What You Need To Know

Employment verification is a process to enable mortgage lenders, financial institutions, government agencies, and employers to confirm an applicant’s present and/or past job status. The process helps establish that the applicant has the requisite work background that they claim to have. Verification of employment may also help identify any fabricated job titles, gaps in employment, and false or misleading claims.

Financial institutions and mortgage providers frequently need to perform VOE checks before they may approve a loan for an organization’s current or former employee. Quentelle utilizes the advanced and reliable VeriSafeJobs solution to automate and speed up the verification of employment process based on the requests it receives from these financial lenders.

Quentelle also receives similar VOE requests from government agencies. When employees seek government assistance, the concerned agency can utilize the Quentelle platform to obtain employment verification. Quentelle offers this service free of charge to government agencies on behalf of the employers it represents.

Why do Mortgage Providers Require Verification of Employment for Loan Approvals?

Why do Mortgage Providers Require VoE for Loan Approvals

Verification of employment is one of the time-tested ways for financial institutions and mortgage providers to protect their financial interests as well as serve home buyers and other loan seekers more effectively. Lenders rely on the VOE process to ensure the loan applicant or a home buyer will be in a financial position to make their loan repayments on time.

Mortgage lenders usually accept a maximum debt to income (DTI) ratio of 43 percent. In simple terms, it means that the borrower’s aggregate debts, including monthly mortgage payments, vehicle loan payments, credit card payments, and other monthly bills must not be higher than 43 percent of their gross monthly income.

Apart from the overall DTI ratio of 43 percent, mortgage providers also usually like to ensure that the monthly home loan payment of a borrower is not higher than 33 to 35 percent of their gross monthly income. Together with the DTI ratio requirement, this general condition helps in rationalizing the lending process for the mortgage company.

Verification of employment plays an important role in this because the lender can be sure that the information submitted by a loan applicant is correct. Although it may appear that VOE is an impediment in the way of borrowers who want to buy the house of their dreams, but in reality, this process helps protect prospective home buyers from obtaining a mortgage they may be in no position to afford.

Mortgage Loans and Gaps in Employment

While employment history is often a key element in a loan application, lenders usually require only a work history of the last two years. Therefore, if the borrower has had employment gaps before that period, it may not affect their loan application. However, when gaps in employment exist in the last two years, it may become a concern for the mortgage provider especially if the length of the unemployment period is 6 months or higher. An unemployment period of just one or two months in the last two years will usually not matter much for a mortgage approval.

Some Employment Gaps are Reasonable

When an employment gap occurred for a valid reason, the mortgage lender or financial institution will give due consideration to it. For instance, a loan applicant may have taken a maternity leave for six or more months, or may have taken time off to pursue higher education.

Temporary disability and layoffs may also result in extended gaps in employment, which a lender is likely to understand. However, multiple job changes within a span of a few months, a short employment history of less than two years, and substantial increase or reduction in income in recent times might be viewed as red flags by some lenders.

Loan Applicants can Explain the Employment Gaps

A loan applicant can increase their chances of their loan getting approved if they provide a valid explanation supported by relevant documents about their prolonged employment gap. Finishing school, going on maternity leave, or performing the role of a caregiver for a sick family member are the kind of reasons that can be backed by documentary evidence.

Sometimes the borrower may be able to demonstrate that they continued to make their existing debt payments consistently during the period of employment gap, which could strengthen their loan application. In general, lenders are looking for employment stability to assess a borrower’s ability to make future mortgage payments.

The Process of Verification of Employment for Mortgages

The Process of VoE for Mortgages

The process to verify employment for the purpose of mortgage approval is not very different from other VOE processes. However, some minor distinctions may exist. In general, the process may include the following steps:

  • The borrower files a loan application detailing their employment history and income information, among other things. Documents such as W-2 forms or pay stubs may have to be submitted at this stage.
  • The lending company communicated with the borrower regarding any additional proof or documentation they may require.
  • The mortgage lender processes the loan application. If no specific issues are found, the lender will proceed with the verification of employment.
  • The lender may choose to verbally verify employment by placing a phone call to the loan applicant’s most recent employer. If any discrepancies are found between the loan application and the employer’s version, the lender will communicate with the loan applicant.
  • In case the loan applicant is self-employed, they will need to submit their proof of income from the IRS. This income document can be obtained by completing Form 4506-T. An official tax transcript issued by the IRS will show the applicant’s income, based on which the lender may approve the loan.
  • Sometimes when a lender approaches an employer with a VOE request, the employer may direct them to a third party verifier. This could make the verification of employment process longer and costlier (the verifier will charge a fee). Third party employment verifiers can additionally offer background checks, but it is important to ensure the background check or background screening is performed in accordance with the FCRA (Fair Credit Reporting Act) regulations.

In general, the manual, in-house process of verification of employment for lenders can be tedious, resource intensive and time consuming. If the employment verification takes a long time to complete, it can frustrate the borrower who may sometimes turn to another lender by the time the VOE is done.

Frequent time lags in the VOE process and slow loan approvals may limit the business turnover for the financial institution. Inaccuracies or mistakes in the employment verification process may create compliance issues or increase the incidence of loan defaults and loss of profitability. Higher operational costs may also impact the bottom line when loan companies attempt to handle the complete employment verification process in-house.

Automation in VOE is Helping Improve the Lending Process

Smart automation in employment verification with a platform such as Quentelle is helping banking institutions and mortgage providers make faster and better lending decisions. Verification of employment, which is considered one of the major pain points in the lending business, becomes streamlined and easy with Quentelle. Over time, it allows the lenders to achieve higher profits and deliver superior services to home buyers and other borrowers.

Traditional Approach to Employment Verification is Inadequate for Lenders

Considering the highly unpredictable and competitive nature of the lending business, loan providers are under constant pressure to sustain their market position while remaining profitable. Using traditional in-house approaches to verification of employment, the lenders experience cost inefficiencies and compliance risks due to potential mistakes by HR teams. On the other side, borrowers are becoming increasingly demanding with high expectations for service and speed.

If it takes a slightly longer than usual time to verify employment, the lender may risk losing the business to their competitors. If they try to rush through the VOE process, mistakes may occur, which can seriously hurt the bottom line. This is where all types of lending institutions, banks, and mortgage companies are now more receptive than ever to move their verification of employment service to Quentelle, which is a cutting-edge digital platform for VOE.

Automation can Streamline the Verification of Employment Process

The decision of loan approval must fundamentally be based on the borrower’s ability to repay. Borrowers with stable employment are more likely to have this financial ability. To identify these borrowers, it is critical for a lender to have a system in place that makes the verification of the employment process reliable, speedy, and accurate. The Quentelle platform is equipped to intelligently automate this function.

Automation in VOE

Repetitive, manual, error-prone and time-consuming tasks such as verification of employment are an ideal fit for automation with Quentelle. It can relieve the employer’s in-house talent of performing mindless administrative work, improve accuracy in verification, and enable the processing of more loan applications within a shorter period of time. At the same time, the Quentelle VOE service can help maintain compliance, while delivering speedy service that drives higher customer satisfaction levels.

Why More Lenders are Choosing Quentelle for Employment Verification

Lending institutions and mortgage companies are increasingly relying on the technology platform of Quentelle for verification of employment. The platform automates the time-consuming and labor-intensive VOE process to complete it in the shortest possible time. Customers experience a dramatic reduction in the time and effort they would otherwise invest in issuing loan and mortgage approvals.

With Quentelle’s VOE solutions, lenders can process loans faster and more accurately, giving a boost to their mortgage lending turnover. Homebuyers and other borrowers are happier because of a more streamlined process and faster loan approvals. Quentelle creates a win-win for all.

More Predictable Timeline

Large and mid-sized lending companies have a regular requirement for employment verification, considering the high number of mortgage applications they receive. Automating the VOE process with Quentelle not only reduces manual paperwork and expedites the process, it also allows for a more predictable timeline. Loan officers as well as loan applicants will have a better idea of how much time the approval will take. The mortgage provider can also set more accurate revenue goals and strategies when there is greater predictability in the lending system.

Better Privacy and Security

When traditional methods of employment verification are used, the in-house handling of the paperwork and documentation does not ensure foolproof safety and confidentiality of the information exchanged. On the other hand, when the mortgage lender utilizes the Quentelle platform, concerns related to privacy and data security are virtually eliminated. The platform’s automated and technology integrated VOE software provides comprehensive data protection and cyber security. Sensitive customer information remains accessible only to the authorized personnel, and the risks of data loss are avoided with cloud storage technology.

Higher Cost Efficiency

In comparison to the traditional means of employment verification, the automated Quentelle platform proves to be significantly more cost effective for the lenders due to superior operational efficiency. The lending organization no longer needs to have a large in-house team to handle the repetitive VOE tasks manually. The automated solution from Quentelle not only makes the verification of employment process easier and friction-less, it also helps cut down the operational costs for the lender to get it done within a tight budget.

Greater Business Focus

When a bank, financial institution or a mortgage lender has access to Quentelle’s automated VOE solutions, it becomes possible to fulfill the employment verification requirements quickly, securely and more reliably. This frees up the time of the talented in-house teams to focus their attention on more strategic and valuable business work. The net result is that the lender manages to close more loans, the bottom line improves due to higher accuracies in the system, the customers are happier, and the company’s market reputation gets bolstered over time.

Improved Compliance

When financial lenders select a technology platform to automate their task of employment verification, they should make sure of the service provider’s technology capabilities, security certifications, and a track record to adhere to the FCRA compliance requirements at all times. Quentelle has robust systems in place to ensure to protect sensitive customer data and follow the norms laid out by the regulating agencies. Quentelle’s stringent verification of employment policy and procedures are designed to ensure full compliance with the law and minimize the lender’s risk of lawsuits.

How Does Employment Verification Work for Employers Looking to Hire Candidates?

Employment verification is a vital element in the pre-employment screening, which serves to assure the new employer that the candidate is a good fit for their organization and the job position they would hold. Employment verification works as follows:

  • The new employer reaches out to the candidate’s past employers to verify details about the candidate, such as: (a) job titles; (b) period of employment; and (c) reasons why they left the job or why they were terminated.
  • These employment reference checks may be carried out as written communication, but sometimes the HR representative of the new employer may also speak directly to the former manager or supervisor of the candidate.
  • This type of background screening and reference checks with the previous employer are usually performed as part of the hiring process – prior to offering a confirmed job to the candidate.
  • The new employer has a legal obligation to notify the candidate about this type of background check and their employment decision.
  • Unlike employee background checks, there is no limit on how far back in time an employer can go with employment verifications from multiple past employers.

Why is Employment Verification Vital to the Hiring Process?

Employment verification is critically important because employees are the strongest asset of any company. Carrying out this meticulous verification for every new hire can be time-consuming for an employer, and errors of omission may sometimes occur.

The right way to conduct background screening and employment verification is to engage the services of a professional firm that has the capabilities and experience in this field to do it in a reliable, timely, and cost-effective manner.

Risk of Employment Fraud

Job applicants may sometimes commit resume fraud if they are desperate to get a job. In their job application and resume, they may submit false information about their academic qualifications, certifications, licenses, and prior work experience; overstate their job duties in the previous job; or fail to provide the correct reasons for exiting from their previous employment. To protect your organization from this type of fraud, verification of employment history is a time-tested approach.

Stakes are High in Positions of Trust

If you hire someone without employment verification, the risk is higher that they may be unfit for organization’s culture and may create disruptions or influence other employees in a negative way. The stakes increase further in positions of trust where the new employee will have access to the company’s confidential data and information or deal with money and finances. Data theft, financial theft, or other wrongdoings of an untrustworthy new employee may result in serious financial losses, damage to business reputation, and risk of costly lawsuits.

Challenges of High Employee Turnover

You may think that even if you end up hiring an unfit candidate in absence of employment verification, you can fire them to get rid of the problem. However, failure to have a system for employment screening tends to increase worker turnover. The hidden costs are enormous. At one end, you will lose in terms of the costs involved in hiring, training, and investing in a new employee. On the other end, frequent terminations due to theft, illicit drug use, violence, and breach of company policies will demoralizes your existing workforce and affect business productivity.

Unemployment Verification Form

When a former employee was removed from their job, they will most likely apply for unemployment benefits in their state. The individual must complete the Unemployment Verification form, which has a section for describing the reason for their removal from job.

The individual who has been terminated from employment might request that their ex-employer provides an unemployment verification letter. They may also request that the unemployment agency in their state provide this unemployment verification letter. This letter can serve as their proof of unemployment.

Unemployment Insurance and the Unemployment Audit Process

The state’s Unemployment Insurance agency will carry out an unemployment insurance audit according to the US Department of Labor guidelines. This audit process ensures compliance on part of the employers and helps answer any questions that may arise.

What Triggers an Unemployment Insurance Audit?

Most of the UI audits are performed randomly every year on a small percentage of employers in the state. The pool from which the employers are chosen includes all companies registered as employing businesses within the state.

For the purpose of the unemployment insurance tax audits, some employers may also be specifically chosen to verify whether they are accurately reporting the wages or they have appropriately classified the workers in compliance with the state’s UI laws.

Even if a company does not have an active Unemployment Insurance account, they could be chosen for the UI audit to assess whether they may be a liable employer. The UI tax audit is performed to verify that:

  • The employer is correctly reporting the workers’ wages.
  • The employer has appropriately classified all workers.
  • The employer has filed all the required reports.
  • The employer has reported the payroll correctly.

Duration and Time Period of the Unemployment Insurance Audit

The general time period of the audit is one calendar year. If the audit reveals discrepancies, it may be expanded to additional years and the tax auditor may request that you provide records for those years. The duration or length of the audit will vary according to a number of factors, such as the size of the company and the number of employees, the availability of proper records, and the extent of issues discovered, if any. The date and time of the audit will be set by the auditor, and the audit may be conducted at the employer’s premises or at their accountant’s office with authorization.

Interfacing with the Auditor

The business owner (employer) is usually not required to be personally present during the audit. They can designate their authorized representative to work with the auditor on their behalf. The auditor may work with the employer’s accountant or another service provider as long as they are an active agent on the company’s UI tax account. In a situation where the agent is unable to answer any questions from the auditor, the employer should be accessible by phone to provide answers directly.

Types of Records Examined in the Audit Process

The employer should maintain proper payroll records and all the necessary documents that are essential to track payroll. All information to the auditor should be reported correctly. Employees and independent contracts should be classified correctly. Records that the auditors typically request in an audit year are listed below. Based on the tax auditor’s findings and review, they may ask for your additional records at the time of the unemployment insurance audit.

  • IRS Forms 940, 941, 1096 and 1099
  • Form W-2/W-3
  • Income record of every employee
  • Financial statements
  • General ledger of accounts
  • Tax returns pertaining to business income
  • Journal of cash disbursement
  • Petty cash account
  • Payroll timesheets, journal, or register
  • Bank statements
  • Master vendor files or listing
  • Corporate minutes
  • Documents pertaining to non-payroll payments made, such as invoices, receipts, contracts, or certificates of insurance
  • Any other records pertaining to payments made to individuals towards services performed

Verification of Employment, Unemployment Insurance Claims, and Human Resources Platforms

Automating the VOE Process

Quentelle helps employers save valuable time and cut down administrative costs regarding verification of employment (VOE) and unemployment insurance claims with the use of advanced technology. Quentelle uses VeriSafeJobs for automating your VOE and income verification requests to help ensure compliance.

Advantages of VeriSafeJobs for Automation

Data Security and Privacy

Features, such as at-rest E2E encryption, FCRA compliance, vulnerability assessment, SOC 1 & 2 and SAS 70 certification, and proactive screening of potential threats keep your data private and safe.

Simple and Smart UX

You can have a simple and smart user experience with a user-friendly interface, quick implementation, and advanced metrics and reporting.

 Unparalleled Client Support

Your inquiries and concerns are addressed on time, every time, thanks to the excellent personnel training, experienced account management, and reliable support and service.

Securing WOTC Credits

Quentelle can provide your company with a streamlined solution that simplifies screening for WOTC (Work Opportunity Tax Credits). We do this through our partnership with Walton, which is a top technology provider for employment tax credits. Walton administers a proven and simple questionnaire during the employer’s process of hiring or on-boarding, which enables it to determine eligibility and seek Work Opportunity Tax Credits on your behalf.

When you implement the automated solutions from Walton, you will have the assurance that no effort is spared to optimize your tax savings. At the same time, your team will be free from this workload to focus on their core business activities. With this proven solution from Walton, you can pursue your hiring requirements while knowing that Quentelle will take charge to handle things efficiently behind the scenes.

ESD Issues

The Employment Security Department (ESD) is required to conduct annual compliance audits according to the guidelines of the US Department of Labor. If you are selected for an ESD audit, you will be contacted by the Department’s auditors to schedule a mutually convenient audit date. ESD will also send you a letter confirming the appointment along with a checklist for the required records and a pre-audit questionnaire.

What Does an ESD Audit Cover?

ESD auditors will conduct a number of functions during the audit, including:

  • Seeking evidence of any unreported workers, independent contractors, casual workers, and other individuals providing personal labor.
  • Comparing the sample time records and payroll with the wage and hours that have been reported to ESD.
  • Reviewing the nature of business and whether you have been assigned the appropriate tax rate (if you are a new employer).
  • Determining whether you have correctly reported independent contractors.

Documents Required in an ESD Audit

For an ESD audit, you may be required to provide employer’s records of the last three years (or more, if business practices are found to be suspect). Records typically reviewed in an ESD audit are:

  • Business ownership licenses and documents
  • Accounting, payroll, and employee time records
  • Financial statements, bank records, general ledgers, and check registers
  • Federal and state tax records (which include IRS 1099)
  • Copies of invoices, contracts, and registration numbers of each independent contractor
  • Opt-in forms for the corporate officer

Transforming Mortgage Lending with Quentelle’s Automated VOE Process

Choosing a professional automated system for verification of employment not only saves time for mortgage lenders to help them close more loans, it also improves compliance, saves on potential legal challenges, keeps customers satisfied thanks to faster loan approvals, and lowers the lender’s operational costs involved in employment verification with confidentiality.

Quentelle’s automated platform for verification of employment is designed to help mortgage providers put the borrower’s interests on top by streamlining the loan approval process. Home buyers are usually making the most important purchase of their life and fulfilling a dream to own a home. Quentelle is committed to empowering mortgage providers through its platform to make the home buying process more simplified and rewarding for everyone involved.

Advantages for mortgage providers with Quentelle include:

  • Superior accuracy and reliability achieved throughout the verification of employment process.
  • Reduction in loan origination time and expense is possible due to minimal friction with borrowers and employers.
  • Possibility to close a higher number of mortgages within a shorter timeframe thanks to an efficient, automated VOE process.
  • Higher scope for generating referrals because the faster and convenient automated verification process helps exceed customer expectations and drives greater satisfaction levels.

Quentelle – Your Dedicated Partner for VOE and More

When you need a professional service provider with the technology and expertise to perform verification of employment, handle unemployment insurance claims, and provide an automated platform for various critical human resource tasks, Quentelle is here to deliver outstanding services and solutions to you. Reach out to us to learn more about how we can help your company save precious time and money with our highly rated and services. To schedule a demo, call us at (888) 565-5515 or complete this online form.

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WOTC Program

3 Ways Your Business Can Maximize the WOTC Program

If you’re a business owner, hiring manager, or higher-up, you need to know about the Work Opportunity Tax Credit program made available by the Internal Revenue Service. Often abbreviated as the WOTC program, this could be an incredible opportunity for your business to receive a tax break. Here are some important ways that your business can maximize from the WOTC program.

What is the Work Opportunity Tax Credit?

At a high level, the Work Opportunity Tax Credit (WOTC) is a Federal tax credit that employers can take advantage of by hiring people from certain target groups. The people that the WOTC requires you to hire typically face hardships when it comes to finding a job, so the government incentivizes businesses like yours to give these people a chance by providing you with tax credits. Many business owners find that once hired, these individuals are some of their finest employees who are grateful for an opportunity.

So how can your business make use of the WOTC tax credit program?

1. Screen Every Potential Employee

Many companies don’t maximize on the WOTC because they don’t screen everyone they hire for a potential tax credit. Many employers don’t have the extra time and bandwidth to follow the simple process the IRS lays out, and they miss out on their opportunity for tax credits. If you are vigilant and screen every potential employee, and then file your paperwork in a timely manner, you can be sure you don’t miss any credit opportunities.

2. Use Form 8850 Properly

To earn your tax savings, you’ll have to follow a process set forth by the IRS that requires you to file Form 8850 within 28 days after anyone eligible for the credit begins work. It’s a sad fact, but it’s common that a business that doesn’t file in time or files incorrectly won’t receive the income tax break they’re expecting.

3. Educate Yourself on Who Qualifies

The WOTC is in place so that potential employees who consistently face significant barriers to employment have an opportunity to work. Some examples are qualified veterans, designated community residents, and ex-felons just to name a few. The full list is on the IRS website. When you educate yourself on who is eligible, you can even tailor specific job listings seeking these types of individuals to give them a chance to work for you. You’re not only helping needy families, but you’ll also reduce your business income tax liability. It’s important to remember that the tax credit varies for the different target groups within the WOTC.

Quentelle is the Best Way to Maximize the WOTC Program

Truly, the easiest and fastest way to do all three of the tips listed above is to use the turnkey WOTC software that we here at Quentelle provide.

Through our partnership with Walton (a leading provider of tax credits), our software will provide you with a streamlined solution that will screen every potential employee easily and virtually automatically. Additionally, you’ll be able to E-sign and file your Form 8850 electronically.

When you use Quentelle, you’ll have a WOTC program that is effortless and gets you the maximum tax credit for your income tax liability. We can also help tax-exempt employers claim their WOTC benefits properly.

Our software is smart and simple. Schedule a demo today by filling out a form, or giving us a call.

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Applicant Tracking System

3 Tips for Picking the Right Applicant Tracking System (ATS)

In many ways, the success of your business overall boils down to the people you have on your team. It’s safe to say that the right employee in the perfect position can make a palpable difference– but it’s also safe to say that the opposite is true. If you hire the wrong person for your team, the effects can be disastrous and lasting.

One of the best ways to streamline your hiring process and find the perfect people to join your team is by using the right applicant tracking system. Simply put, an applicant tracking system is a piece of software that allows you to screen resumes efficiently and easily rather than trying to manually review countless resumes by hand.

Let Talent Acquisition Software do the Heavy Lifting

If you’ve posted a job listing lately, you’ll notice that applications come flooding in. Some of them have read your posting, others haven’t– but yet you’re staring down the barrel of 567 resumes on the first day, and your task is to find the most qualified applicants– much like trying to find a  few needles in a haystack.

When you think of an applicant tracking system, think of it more as your ‘Talent Acquisition Software.’ You’re looking for those perfect candidates, and this is the tool that will help you find them without a ton of clerical work and wasted time.

So how do you know the perfect Applicant Tracking System for you? Follow these tips, and you’ll be in the clear.

1. Know Your Needs and Work Backward

When you’re looking for the perfect recruiting software, it can be tempting to look at solutions that have a lot of features, bells, and whistles. Remember though: think of your needs first, and then choose the best talent acquisition software based on how well it can handle exactly what your hiring process will require.

2. Talk to the People Who Do Your Hiring

In our experience, you should absolutely include your hiring managers in the search for your talent acquisition platform. You’d be surprised how many higher-ups within companies choose their talent acquisition software without involving the actual people who do the hiring. You want to involve your entire talent acquisition team because they will have the boots-on-the-ground experience when it comes to your actual hiring process.

3. Keep Compliance in Mind

With an applicant tracking system, be sure that it is 100% current and compliant with the way that it works. Security is also a huge factor. When you fail to verify compliance, the sad fact is the consequences will fall on you and could result in fines and tons of red tape and clerical work. This is especially true when trying to capture WOTC (work opportunity tax credit) information, which has a direct financial impact on your business.

Quentelle is the Leader in Applicant Tracking Systems

No matter what you’re using to hire great talent, the last thing you want to be doing is managing multiple job boards and dealing with job seekers who aren’t a fit for the position.

Here at Quentelle, we are the leader in HR software and recruiting solutions. We’d love to show you a demo of how we can provide easy access to data-driven insights that will help you maximize and retain your workforce.

Our software is smart and simple. Schedule a demo today by filling out a form, or giving us a call.

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Hiring Managers

Hiring Managers: Are You Tired of Your Inefficient Onboarding Solution?

There’s no question that the job market has changed drastically in the last eighteen months, and if we’re being candid, it shows no signs of going back to the way things once were. Now more than ever, it’s not only crucial that you find the right employees, but that they’re also onboarded into your company’s community and culture in a way that sets them up for long-term success.

As hiring managers, you have many critical responsibilities that rest on your shoulders, and in our experience, onboarding can be one of the most challenging tasks to manage efficiently.

This is also a pain point for many hiring managers who find that their onboarding solution isn’t always explicitly and clearly defined, which can lead to inefficient uses of time and resources. Every company is unique, and no two onboarding processes are the same, which can be challenging when trying to look for benchmarks and examples to model your own onboarding after. And since there are no “cookie-cutter” solutions that will be 100% effective, you’re typically tasked with building your own onboarding solution from scratch, or using whatever process you inherited when you became the hiring manager.

If you’re tired of your inefficient employee onboarding process, we’re here to help.

Why Onboarding is Critical

When you hire someone, you use an interviewing process to properly vet them to see if they’re a fit for your organization. However, once they’re hired, an unspoken thing that often occurs is that the employee uses the first week or two of a new position as an interview for you. Some people will even leave a job if the onboarding process seems lackluster, unorganized, or unprofessional. Think about it: the onboarding process is your first impression to show your employees that you’re a professional company that deserves their very best efforts and loyalty. It’s a sad truth, but many companies have an unstructured “seat of the pants” onboarding for new employees. If you had to honestly rate your existing onboarding process on a scale from one to ten, what would you give it?

Onboarding Software is What You Need

Think of all the software tools you use throughout your day–  there’s software that specializes in just about everything nowadays. You’d never dream of using a paper and pencil ledger when you have spreadsheet software that is far more powerful and quick at your fingertips. You need to take this same approach when it comes to your onboarding process. By using software, you can have a clearly defined, easy-to-use onboarding process that’s efficient and simple. Are you still using the equivalent of pencil and paper when it comes to your company’s onboarding? If so, it’s time to make the shift into the current age, and get rid of your inefficient onboarding solution.

Quentelle Provides Best In Class Onboarding Software

Employee onboarding is one of the most important ways to make an incredible first impression on anyone who joins your team. Here at Quentelle, we offer a smart and simple user experience while delivering the best HR software on the market. When you use our suite of intuitive tools to handle your onboarding tasks, you can rest easy that our award-winning software will make your job as a hiring manager far more efficient.

Our software is smart and simple, and we’d love to show you how it can work for you. Schedule a demo today by filling out a form, or giving us a call.

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Fair Credit Reporting Act

What Are FCRA Data Privacy Laws?

We’ve had an unprecedented last couple of years, and the overall state of the average consumer’s credit is different in many ways than it has ever been before. Now more than ever, when it comes to data and privacy, it’s important that your business is current on the laws and regulations on how you can collect, access, use, and share any data (from both clients and employees) as it pertains to credit reporting. Are you educated and prepared for the next year? Let’s dive into what you need to know about the Fair Credit Reporting Act (FRCA) and data privacy laws. Remember that this isn’t legal advice, but general guidelines to help you navigate any pitfalls that might land you in a state or federal court.

What is the Fair Credit Reporting Act?

Simply put, the Fair Credit Reporting Act (often abbreviated FCRA) is a federal law that was put in place to protect the accuracy and privacy of people’s information when it comes to their credit scores. It was put in place by the Federal Trade Commission back in 1970 and is more important now than ever.

These laws specifically regulate the way that a consumer reporting agency or credit bureau is able to use the information they use in your consumer credit reports. It limits what and how they can collect, access, use, and share the information.

In addition, the FCRA also grants consumers access to their credit history. Every 12 months, Federal law states that every consumer has a right to get a free copy of their credit report. This is to allow people to see any negative information that may have been placed on their credit file without their knowledge. From there, they can take action and dispute any inaccurate information with the various credit bureaus.

What Should You Focus on as a Business?

You and anyone on your human resources staff need to know how important the FCRA is, how strictly it is enforced, and what the legal ramifications are if you don’t follow the laws.

One of the most important aspects of this law is consumer consent. You can’t just pull someone’s credit report without their permission, and that permission must be in the form of written consent. These consent forms have very specific formatting and language that need to be included to be considered compliant.

Additionally, you can’t access anyone’s consumer credit information unless they’re directly related to your company, such as an employee, volunteer, or someone you’re considering as a potential employee.

Something that most companies don’t realize is that the FCRA isn’t just for getting a potential or existing customer’s credit report– it’s also directly connected to any formal background checks. If you follow the guidelines and perform a background check on someone (with their consent), such a request impacts what you have to disclose to that person. For example, if you are thinking of not hiring someone because of something you find on their background check, you have to send them an “adverse action notice” before you make the final decision. The applicant then has time to respond with a reply or reasons they disputed information on the report. If the applicant responds and you still choose not to hire them, you have to send a second adverse action notice letting them know what you decided.

Quentelle Can Help

Do you still have questions about how the FTCA may affect your business? Here at Qunetelle, we serve a growing number of clients and partners just like you. Our turnkey suite of proven solutions is ready for you to give it a test drive.

Our software is smart and simple. Schedule a demo today by filling out a form, or giving us a call.

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HR Technology Provider

3 Benefits of Partnering With a Proven HR Technology Provider

Human Resource outsourcing comes in all shapes and sizes, but can be one of the most powerful changes to optimize and safeguard your business. What we’re specifically talking about isn’t full outsourcing, but rather offloading the challenging portions of the human resources (HR) department with software. By partnering with the right HR technology provider, you’re equipping your HR department with the tools they need to function at their very best. However, when choosing an HR service provider, not all are created equally. Here at Quentelle, we have an incredible all-in-one HR software solution that can change the way you do business in many ways– here are just a few of the benefits.

Benefits of Using HR Services Companies

Again, we’re not talking about full human resources outsourcing, but outsourcing the painful, often mundane busywork of how the HR department functions. When you allow your staff to use their HR expertise on improving and optimizing how your business runs, everyone benefits. Here are just some of the high-level benefits you’ll experience when you partner with the best HR outsourcing services available, Quentelle.

1. Empower Yourself to Make Decisions

When you use a proven technology provider such as Quentelle as your internal human resources software, you’re going to put yourself in a position to see many facets of your business in one place. Our platform leverages artificial intelligence (AI) to compile, query, and analyze large amounts of data and uncover trends and patterns. When you’re able to see and manage employment verification, point-of-hire tax credits, unemployment claims, and unemployment tax planning in one place, you’re going to be in a position to plan well, save money, and be at the apex of risk management.

2. Optimize Your HR Workflow

Any small business has an HR team that is constantly busy. Payroll and tax administration, payroll processing, keeping up on regulatory and legal changes, and helping employees with their needs are all integral parts of keeping your company running smoothly. The last thing you want to do is keep your HR team busy keeping track of their HR responsibilities in various methods on different platforms. When you have human resources outsourcing services like our software suite, your valuable employees can focus on the HR processes that need their attention most.

3. A Better Employee Experience

Not only will a proven HR technology partner help your human resources team, but it will also directly provide employee benefits. Our software suite will allow your employees to handle many of their own personal human resources tasks. And when employee self-service is an option, it’s more convenient and quicker for everyone involved.

Quentelle is the Best HR Service Company

Many of the existing HR outsourcing services are scattered throughout various websites and programs, and they can be cumbersome to use well.

When you choose to partner with our team here at Quentelle, you’re choosing the superior alternative to other, more traditional HR service bundles. , We believe in what we call the “power of one,” which for your business means one contract, one platform, on payroll file, and of course, the absolute gold standard when it comes to collaborative service providers.

Let us show you how we handle HR outsourcing differently by empowering your team. If you’re ready to experience one suite of proven solutions and protect yourself from cybercrime, let’s talk.

Our software is smart and simple and can provide you with the best HR services available. Schedule a demo today by filling out a form, or giving us a call.

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