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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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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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UI claims

UI Claims: Are There Hidden Costs Associated?

No matter the reason, having to let go of an employee is never easy. And as challenging as the situation may already be for everyone, employers must also consider the full ramifications that terminating someone has on the business.

Unemployment claims are a part of any business’s responsibilities as they terminate employees. And, when the time comes, you want to be ready. As such, it is crucial that employers understand the costs associated with unemployment claims and how they impact the bottom line.

In this article, we’re going to give you some of the things you need to be careful of with unemployment claims and how to avoid potential hidden costs when it comes to unemployment insurance (UI).

UI Claims Are the Employer’s Responsibility

One of the biggest misconceptions about unemployment claims is that they are not the responsibility of the business. It’s a common mistake to believe that when you’re paying your unemployment insurance that it acts like Medicare or Social Security. Many business owners think that the funds are going to come out of an already accrued amount, like drawing from an account of some sort. That is not the case, and the costs can actually exceed the amount of the claim by a great deal.

Unemployment is funded completely by employers in almost every situation. Only Pennsylvania, New Jersey, and Alaska tax employees for their unemployment insurance. Apart from those three, unemployment occurs on a state and federal level where it is taxed and funded.

Here are some things to keep in mind:

  • The Federal Unemployment Tax Act (FUTA) is a flat rate for the first $7,000 you pay an employee.
  • FUTA is currently 6% (though many states receive a 5.4% credit effectively making it 0.6%).
  • There’s nothing you can do as a business to change this rate.
  • If a state doesn’t have the funds in their unemployment insurance funds, this money serves to help with claim payouts.
  • States need to repay anything used in this fashion or their employer tax rates get raised.
  • The State Unemployment Tax Act (SUTA) varies much more widely with employers paying different rates on taxable employee earnings.
  • States often have a unique and specific way that they assess and calculate what companies pay.

There’s much more to it than that; but this is a general primer so that you can understand that you are in fact very likely going to be responsible for paying any unemployment insurance claims. This is the first hidden cost that most businesses face. Even though it’s not technically hidden, it’s largely misunderstood and surprises many business owners.

Hidden Costs: Increased Tax Rates

While many factors come into play when it comes to unemployment insurance claims, one of the most detrimental hidden costs comes in the form of increased taxes over time. Each unemployment claim that’s awarded actually increases UI tax rates and can do so for up to three years. When your company gets hit with a UI claim, the hidden fee might not come immediately. But, you should be on the lookout down the line.

Quentelle Can Help

Don’t risk facing these issues of unemployment insurance alone; it can end up costing you a lot of money in the long run.

We’re experts at unemployment insurance and have the software to help you navigate UI claims seamlessly. Let’s schedule a demo today.

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What to Look For in Your Human Resources Business Solution

Human Resources continues to be one of the most essential departments in the business world. Without it, your employees wouldn’t have access to the proper tools they need to stay successful.

This is why your HR department needs smart business solutions to keep the workforce thriving. With the right technologies, your HR can help prevent turnover and create more engagement among employees.

However, if you feel like your HR team has slipped behind technologically, take a look at some key things to look for as major solutions.

Verification of Employment Solution

One essential task HR takes on is verification of employment. This also usually involves income requests, requiring considerable organization based on the complex data involved. You need top-tier tech solutions to organize it all, plus keep all that sensitive information safe.

Many companies outsource this task to third-party companies. Not all companies do a good job, especially if not more focused on comprehensive HR technology.

Your best solution is going through VeriSafeJobs, offered through Quentelle, and bringing more superior reporting capability to your operations. The use of VeriSafeJobs lets you enjoy advanced metrics, so all employment verifications are thorough. A smart and simple user experience also helps with learning curves.

It’s also worth noting that VeriSafeJobs has unmatched client support, so your HR team gets questions answered fast. Privacy is taken seriously with FCRA compliance.

Simplify Unemployment Claims

Your HR group already knows the complexity of dealing with unemployment claims through your employees. The process was once very protracted, leading to possibly exhausted HR workers keeping up the pace. Most of this resulted from adhering to filing deadlines, creating issues when sending claims by regular mail.

Now you can simplify it by using ValeU NSN, a partnering company with Quentelle. This works by digitizing the entire unemployment claims process. Your company should be able to send these claims electronically, so you never miss deadlines.

The result of this is getting a week’s head-start on claims, so they’re filed sooner. Response times are ultimately faster as a result.

ValeU NSN is made for Fortune 100 companies, though any-sized company finds benefits using this solution. Implementation should also be simplified when you work with the right consultant.

Reduce Unemployment Tax Complications

Your HR department probably wouldn’t argue that dealing with unemployment taxes is one of the most complex tasks they’ve ever done. A considerable burden here is the overly complicated tax rules in each state, usually creating inaccurate data.

Our partnership with ValeU Group provides more accurate figures, so you never have to worry about tax penalties again. The benefit here is Vale U Group has more extensive knowledge of state tax rates, hence having a real unemployment tax expert in your corner.

Expect them to hunt vigorously for errors and provide the most accurate reports. These are real state tax experts who work as outsourced advisors.

Working with them, you’re guaranteed accurate unemployment tax information. Plus, you gain a dependable consultancy team on all other tax matters.

Simplify Your WOTC Program

Taking advantage of tax credits is no doubt a vital part of your business. A WOTC program is beneficial not only for you but to those you hire who have barriers to employment.

Otherwise known as Point-of-Hire tax credits, getting WOTC set up can take a lot of time for your HR team. Much of this is the pre-screening process, not including waiting to sign the 8850 form.

Our partnership with Walton gives you access to quality tax credit experts who can save you more than if letting HR handle it. Walton simplifies the process by sending digital questionnaires your employees fill out. Based on their answers, Walton finds ways to bring double the savings possibly. 

Now you can speed up the eligibility pre-screening, plus get help with other tax credits you overlooked. Read about how our partnership with Walton saved a national grocery chain double the amount from what they initially thought.

Improve Your HR Analytics

Your HR staff likely already use analytics of some sort, but how detailed are they? Not all analytic programs are great at providing the granular information HR employees need to help other company employees. When HR doesn’t see the whole picture of what’s going on, it only frustrates those they’re trying to help.

Our HR analytics engine keeps your HR workers in the know. It all starts with tapping into big data and organizing it in the most efficient ways. You can expect to bring more optimal employee performance using a better approach to big data.

Improving this further focuses on utilizing artificial intelligence to compile all the large amounts of data coming in. AI has truly advanced tenfold from just a few years ago. Now it can help organize metrics in a truly more intelligent way. Best of all, AI scopes out business trends you probably can’t see without more help.

Rounding this out is our metrics platform is fully integrated into the HR solutions suite. This enables your HR team to access all data from one source rather than from disparate data silos. Accessing information all in one place makes for more productive HR workers rather than add to their stress.

Bring a Digital Transformation to Your HR Department

Based on the above tools, you can see that a digital transformation must keep up with business challenges in today’s times. HR duties are far more complex today than a decade ago. 

Finding the right technology is the biggest hurdle. Another challenge is finding tools that integrate, so HR workers don’t have to search from multiple sources to answer critical questions.

We take technology seriously at Quentelle, where our sophisticated big data program is now renowned worldwide. Through that, we’ve incorporated AI and other emerging technologies to help advance companies to new plateaus.

Customizing is also at the center of our mission since every company’s HR department is different.

Contact us to learn more about how we can improve your HR team’s work by scheduling a demo.

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A Brief Guide to State Unemployment Taxes

Sifting through unemployment tax law is a difficult and time-consuming task. The heart of this problem is that each state has its own set of unemployment tax rules and regulations and is also subject to federal laws, which are standard across all 50 states. 

Interpreting unemployment tax law is a complex undertaking as it is; the COVID-19 pandemic has added multiple layers of complexity to the process. Now, with additional legislation like the CARES act and FFCRA, it can be challenging to know where to turn when you have questions about your company’s unemployment tax obligations. 

In this article, we’re going to look at the critical components of unemployment tax law, discuss how current Coronavirus relief legislation modifies those existing rules, and establish a list of quality resources that you can turn to to get your important questions answered.  

Unemployment Tax: Key Things You Need to Know

Unemployment tax was first established under the Federal Unemployment Tax Act (FUTA) of 1939. This piece of legislation, which was created in response to the Great Depression, has evolved to address the modern workforce’s needs. The law was designed to offset unemployment’s social and economic impact by placing a portion of the cost onto employers in general. 

FUTA funds unemployment by collecting a payroll tax. However, it should be noted that this tax is only levied against you as a business owner, not against your employees’ paychecks. While the amount of tax that the federal government collects has changed over the years with updates to the legislation, the way that the tax is assessed has remained the same. Through 2020, the tax rate was set at 6% of the employee’s first $7,000 in wages per year. That means that the employer takes 6% from a minimal, predetermined amount rather than the employee’s overall salary. It should be noted that the tax is not assessed on employees who make $1,000 or less per calendar year. Tax is also not collected on employees aged 21 or under. 

The basic method for figuring out your company’s unemployment responsibility is:

  • $7,000 x 0.06= $420/employee/year
  • $420 x total number of employees= unemployment tax obligation

The current FUTA standard also makes a provision for a 5.4% tax credit, which results in a tax bill of $42 per employee every year. To qualify for the credit, your company must pay state unemployment tax and file form 940 (which is a yearly requirement anyway) with the IRS.  

The challenge to employers comes with state unemployment taxes, as every state administers its own unemployment program, and imposes an employer-funded tax levy. Below, we’ll provide a more comprehensive guide to available resources that can help you determine the rules for your particular state.   

When figuring your unemployment tax burden, you should inquire if certain types of payments are excluded from the overall calculation. Those types of payments include:

  • 401(k) contributions
  • Life Insurance
  • Fringe benefits and per diem payments
  • Childcare allowances

Employers are required to pay their unemployment tax quarterly throughout the year.

A Wrench in the Works: the CARES Act

Along with the COVID-19 pandemic, there came a surge in unemployment cases nationwide. At one point, the US economy suspended or eliminated more than 22 million jobs. Several legislative remedies were passed into law, including the FFCRA, which extended the definition of emergency paid leave. The CARES act offered additional unemployment insurance up to $600 dollars per week. There is an old saying, however: there’s no such thing as a free lunch. 

While the CARE Act served as a lifeline for many struggling families, there are tax implications to receiving that kind of governmental assistance. Employees who failed to set aside taxes might find themselves without their expected refund. 

For employers, the CARES act results in additional paperwork and due diligence. While the federal government fully funds the unemployment insurance itself, each state has its own mechanism for carrying out the program, complete with qualification requirements and reporting. The bottom line? Unemployment tax is already muddy water; pandemic-related legislation just opened the floodgates.  

Resources to Help

So the burden of understanding unemployment benefits and their associated tax burden falls to the employer. But with each state in charge of its own rules —on top of federal requirements— that’s no easy task. Information differs on a state-by-state basis, and even then, it can be difficult territory to wade through. Where to begin? 

The single best place to start your search is with the United States Department of Labor (DOL). They have a page set up specifically for employers that links to each state’s unemployment insurance program. This site gives employers a contact list at a glance and helps empower HR and accounting staff to find good, quality information on a state level.

To understand how unemployment insurance —including the CARES act— works for the employee, the DOL also offers a website geared toward the workforce filled with valuable information and necessary forms.  

For information on federal unemployment programs, the top-level governmental website, USA.gov, has an unemployment-related directory filled with information related to numerous national programs as well as additional high-quality resources. 

If, for some reason, the government-curated resources don’t answer your question, or you find them obtuse and difficult to use, numerous third-party organizations such as the Tax Foundation strive to bring up-to-date information to the American workforce, including employers. 

Enlisting Personalized Help

Understanding tax laws is difficult no matter what type of tax you’re working with. There is no substitute for getting advice from a professional resource. The Quentelle platform is proud to partner with the ValeU Group to provide unemployment tax planning services through our technology and consultancy expertise. For more information, please contact us today. 

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Faster, Safer and More Efficient: The Important Benefits of Cloud-Based Business Technology Platforms

More and more businesses are switching to cloud-based software partners to better manage their HR, payroll, taxes, and other critical aspects of their corporate infrastructure. In fact, the market size for cloud-based technology platforms and universal data integration is growing at unprecedented rates, with the industry set to more than double by the year 2025. 

The key factors driving this rapid transformation are the numerous benefits — for both the business and the employees — that come with implementing a cloud-based platform. Whether you’re a CHRO or CFO, understanding these critical advantages can help you to determine better when, not if, your company should make the transition.

Human Resources Management Systems For the Modern Business: What Is Cloud-Based Technology for Operations Management and Human Resources?

Over the last few decades, best practices for managing day-to-day business operations — from human resource issues like employee screening to payroll tasks like employment verification requests — have evolved considerably. 

Gone are the rooms filled with boxes, the filing cabinets stuffed with employee files, and the stacks of forms that need to be filled out manually. 

Yet, many companies are still using fragmented software ecosystems: One platform for unemployment tax planning. Another service for managing employee screenings. A separate tool for cybersecurity (approximately 80% of businesses have suffered a cybersecurity incident in the past 12 months, warns Security Magazine). And so on and so forth.

Cloud-based technology platforms combine all these aspects of your business into one system, creating a more holistic approach to data integration. When you transition your business operations and software to a single unified cloud-based approach, you and your staff have a single point of reference for all your essential business management tasks. 

And because it lives in the cloud (i.e., a secure, protected off-site server instead of a local, physical hard drive in your office), keeping different files and data updated and secure across teams, departments and locations are effortless. 

This can create several specific benefits for your organization, no matter your industry or niche.

The 5 Benefits of Cloud-Based Technology Platforms for Today’s Modern Corporations

1. Improved Efficiency

When your data is combined on the cloud, your team no longer has to shuffle through reams of paperwork, chase down the latest version of an employee file, or ask different departments what the status is on a tax document. 

Instead, everything is accessible on-demand to those who need it:

  • Data is updated instantaneously.
  • Files and information are accessible anywhere and at any time.
  • Paperwork, such as tax documents or payroll records, can go entirely paperless for improved employee productivity.

If another employee needs to see a file or a different department is auditing something, those involved can rest assured that what they’re seeing is current and up-to-date.

This enhanced efficiency can lead to:

  • Improved employee morale
  • A reduction in costly errors
  • Enhanced productivity so your team can focus on more important work.
  • Cost savings across the board

2. Plug-and-Play Scalability

With a unified approach to data integration, apps and services can integrate directly into your cloud-based platform to meet your business’ growing needs. You can finally say goodbye to dreaded IT questions about software installations, updating a version of a specific tool, different departments using incompatible systems, etc. 

Take employment verifications as one example. As your business expands, your team will steadily become inundated with more paperwork regarding employment verification. 

In one Quentelle case study, a payroll director at one Fortune 500 said their staff was spending a “vast amount of time dealing with verifications each year.” With a cloud-based platform, this company was able to integrate quickly with a cloud-based employment verification provider. Within a year, the case study client saved thousands of hours of employee time.

3. Faster Innovation

Continuous software licensing and technology upgrades can be costly, yet ignoring updates can leave your business open to security threats or locked out of innovative new features. 

A unified, cloud-based platform ensures upgrades and deployment of said updates can be instantaneously and conveniently rolled out across the board, helping your business better adapt to a continually changing environment.

4. Increased Security

According to Security Magazine, nearly four out of 10 C-level executives said that cybersecurity problems negatively impacted their company’s ability to attract new customers.

Local servers and drives need constant patches, updates, and maintenance to protect your team’s data and customers’ information. But it’s not just about malicious viruses or unscrupulous hackers. Security threats can even come down to human error: 

  • A shared computer where an employee forgets to log out of something
  • Someone is accidentally deleting important data.
  • A power outage that wipes out your computers

Cloud-based computing with the proper cybersecurity best practices and protocols offer:

  • Constant data backups 24/7/365 security monitoring and network management support 
  • Disaster recovery and backup 
  • Audits and assessments to identify potential risks to your business
  • And more

5. Smart and Savvy HR Insights

The wisest business decisions are built off of smart, strategic business data. Yet, in traditional non-cloud environments, data lives on so many different systems that it can be challenging to decipher the right approach to a problem or situation. 

The best cloud-based platforms for HR and payroll professionals offer predictive analytics using artificial intelligence. Because all the data is unified in one system, the AI can provide powerful insights to drive the boardroom’s decision-making processes.  For instance, Quentelle’s cloud-based platform has built-in AI that compiles and analyzes your data to help you to spot trends and patterns to improve operational effectiveness. 

Is Your Business Ready to Access These Benefits?

At Quentelle, technology and innovation are our team’s passion. Our cloud-based platform offers you a secure and convenient approach to unified data integration. Our proven solutions powered by advanced technology include:

  • Unemployment management claims 
  • Tax planning 
  • Point-of-hire tax credits 
  • HR analytics 
  • Cybersecurity 
  • Employment verification 
  • And more!

We’ve worked with everyone from small businesses to global conglomerates to transition their teams to cloud-based platforms. And we would love to work with you. To learn more about the benefits that cloud-based technology platforms can bring to your company, schedule a demo today!

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Transforming Your Unemployment Claims Management

As an employer, you’ve experienced the frustration of working with a government agency.  You’ve paid federal, state, and local taxes.  You’ve worked through the paperwork for worker’s compensation and unemployment claims.  Some days, you think what could be worse?  

How Does the Unemployment Insurance Claims Process Work?

Unemployment insurance was created as part of the Social Security Act of 1935, and it has remained fundamentally the same for the last 85 years.  Although Congress created the program, its implementation was left to the individual states.  As a result, each state has its own state unemployment office.

Filing a Claim

When people apply for unemployment, they must meet state-specific requirements before they can receive benefits such as:

  • They are actively looking for work.
  • They have completed a waiting period.
  • They were laid off. 

The claims process was originally an in-person, paper-based process.  Although some states transformed their operations, most offices follow the same procedure set out in 1935.  The only difference is the paper has been replaced with electronic copies.  

Reviewing a Claim

The state is responsible for granting or denying an unemployment claim; however, they do inform the claimant’s most recent employer that a claim has been filed.  The employer can contest the claim or let it stand.

  • If the claim is legitimate, employers do not need to take further action.  The state will issue a determination letter to employers and claimants, indicating the decision.  
  • Employers may contest the claim by responding to the notification letter within the specified timeframe.  Failure to respond may result in a forfeiture of the right to contest.

Contesting a claim requires documentation such as employment start and end dates, compensation, and job title. Payroll records and personnel files may be required.  Once the state has reviewed the information, it will issue a determination letter notifying the employer and claimant of the decision.

Appealing a Decision

Both the employer and claimant have the right to appeal a decision, but the appeal must be filed within a designated period of time. Appeals mean more documentation and additional filings.

Paying a Claim

As an employer, you begin paying for UI claims the moment you hire an employee.  Employer-only taxes are collected at the state and federal level for each employee.  The federal rate is fixed, but states determine an employer’s tax rate based on industry, experience, and the number of employees claiming benefits.  The more claims, the higher the rate.

How Could the Unemployment Claims Process Work?

Transforming the claims process requires a return to the original objectives of the unemployment insurance program.  Its purpose was to deliver financial assistance to the unemployed through prompt payment of benefits.  In-person safeguards were used to reduce fraudulent claims.  Today’s advanced technologies make it possible to expedite claim processing while protecting employers and UI agencies from system abuse.

Filing a Claim

Unemployment agencies use the State Information Data Exchange System (SIDES) to facilitate the electronic transfer of claims and associated documents.  Instead of sending notification letters through snail mail, agencies can deliver filing documentation to the employer electronically.  No time is lost in transit, giving the employer the maximum amount of time to prepare a response.  The computer-to-computer interface not only expedites the initial filing, but it also reduces the number of data-entry errors that can occur.

Reviewing a Claim

With an automated claim processing solution, the digitized information can be evaluated using artificial intelligence and machine learning.  By deploying rule-based technology, automated solutions can perform the following:

  • Contest questionable claims
  • Respond to inquiries within state-issued deadlines
  • Verify claim-provided data

When discrepancies occur, the system can flag the claim for intervention.

For employers with employees in multiple jurisdictions, an automated solution can reduce processing errors.  The system can ensure that:

  • No deadlines are missed.
  • All information is provided.
  • All legal considerations have been addressed.

Without advanced technology, UI staff could be inundated with changes in state-specific requirements.  Something as simple as an address change can derail the entire claim process.

Appealing a Decision

No matter who appeals a decision, employers will need to provide additional information.  A digital solution ensures that all documentation from the notification letter to the appeal request is in one location, making it easy to access.  Employees no longer have to search files, sort emails, or scour directories to find information.

Paying a Claim

Once a claim is approved, many companies consider the process complete and rarely, if ever, revisit a UI claim.  Given the workload associated with the process, it’s no wonder that employees lack the time to check each approved claim.  Yet, it is crucial that payments are monitored on an ongoing basis.  

The state rate (SUTA) varies from one jurisdiction to another, as does the method for calculating what SUTA an employer owes.  In most instances, the more an employer uses the system, the higher the tax rate.  A recent analysis by the Bureau of Labor Statistics found that the SUTA rate can increase nearly 30% after a series of layoffs.

Transforming the Process

At its core, digital transformation is the ability to use technology to change how companies operate and how they add value for their customers, employees, and business partners.  By deploying technology, organizations can become agile and better able to respond to business fluctuations.  With a platform-based solution, an enterprise can pivot and continue to process UI claims without disruption.

Automated solutions make it easier for businesses to realize faster processing times, reduce errors, and lower tax rates.  They also free employees to work on higher-value tasks that encourage collaboration and innovation.  Technology facilitates the growth of a digital culture that can sustain a digital transformation.  If you are looking for a UI claims management solution, contact us to schedule a demo.

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