Beware of "pending" decisions

For those who manage unemployment claims, there is an “expected” process: an employer receives a claim from the state agency, they respond to that claim, and subsequently receives a decision (usually within 6 weeks). We have observed a trend, however, where state agencies may never issue a decision.

How can employers manage costs if they don’t know the outcomes of cases?

If a claimant files a claim, but fails to complete a weekly certification, state agencies may not issue a decision. This lack of clarity can leave employers questioning whether a decision was never issued, or if it was simply lost in the mail.

Typically, states will issue a decision after (1) a claim is filed, and (2) a claimant submits a weekly certification. During the certification, claimants attest that they continue to be unemployed and are actively seeking work. However, some claimants never complete the certification process and are therefore not issued any checks for weekly benefits. This can happen if a claimant becomes re-employed quickly, fails to fulfill the work search requirement, or simply drops out of the complex process.

What’s an employer to do?

According to Director of Client Services Jeff Burmeister, “In this situation, an employer’s process around tracking, reporting, and auditing becomes critical.”  

To illustrate, we have provided two examples.

Example 1: A claim is filed, but the employer does not receive a decision. After carefully checking future benefit charge statements, no charges are ever paid to this claimant.

In this case, the employer can be confident that they have not been charged for any benefits associated with this individual. However, charges can appear up to 2 years after a claim is filed, so it is important to maintain a rigorous auditing process that identifies and protests charges resulting from years of pending claims.

Example 2: A claim is filed, but the employer does not receive a decision. Subsequent benefit charge statements show that the claimant was paid benefits.

In this case, the employer should protest charges by the state’s mandatory deadline. The employer should include verbiage that a decision was never received, and therefore protest rights should be reestablished. The state agency will often re-issue a decision, allowing the employer the opportunity to contest the claim.

Take-aways 

In Ohio, the average cost per claim is $6,816. Following the below steps will enable employers to reduce unemployment costs.

Employers should track unemployment cases and their outcomes over multiple years. When benefit charge statements are received, audit each line to ensure accuracy. Any incorrect charges – whether due to a missing decision, error, or fraud – should be promptly protested with the state agency.

Does this sound like a lot? Sedgwick experts are available to support you! Please contact our unemployment team at unemployment@sedgwick.com to learn about other best practices to mitigate unemployment cost.