Unemployment fraud in Ohio

Ohio, like most states, is still experiencing an increase in fraudulent identity theft unemployment claims. Ohio Department of Job and Family Services (ODJFS) as of June 30, 2023 has identified approximately $6.9 billion in overpayments this includes what is classified as fraud and non-fraud. While the bulk of these transaction were for the Pandemic Unemployment Assistance (PUA) program. Traditional unemployment continues to suffer as $1.076 billion has been paid.

Sedgwick recommends the following steps if you receive an unemployment claim that is fraud.

• Let the employee know and verify if that person had in fact filed.
• Please notify us (if your organization is a Sedgwick Unemployment client) or the state agency as soon as possible.
• Please respond to any and all notifications you receive (it is possible that several claims could be filed, and we recommend responding to all of them).

For Sedgwick unemployment customers, as soon as we are notified that the claim is fraudulent, we quickly report the information to ODJFS to help prevent unemployment benefits from being released.  Often, the fraud claim is shut down quickly and considered invalid by ODJFS, thus preventing improper payments. 

Since a fraud claim is a true form of identity theft, we recommend the individual affected by the claim also take steps to protect themselves.

Resources

Contact the ODJFS at the number below or via the website to report fraud:

• To report fraud:
  • ODJFS Online reporting: https://odjfs2.secure.force.com/OUIOFraudReportingPortal/
  • ODJFS Fraud Phone Number: (800) 686-1555
• For additional information and resources:
  • ODJFS Fraud Website: https://unemploymenthelp.ohio.gov/IdentityTheft/

For general information on how to respond to identity theft:

• US Department of Labor
  • https://dol.gov/fraud
• National Fraud Resources: https://www.identitytheft.gov/
  • You can submit a report at a federal level of this unemployment fraud on this site.
• Credit Reporting Agency Phone Numbers and Website Information:
  • Equifax – (800) 685-1111 or https://www.equifax.com/personal/credit-report-services/
  • Experian – (888) 397-3742 or https://www.experian.com/help/
  • TransUnion – (888) 909-8872 or https://www.transunion.com/credit-help/

Returning to normal - take advantage of special tax rate saving strategies
and account management

Even though unemployment claims volumes have returned to pre-pandemic levels, it is still critical for Ohio employers to keep focused on the key strategies of managing unemployment costs, especially since state trust funds that have been depleted by high claims volumes will need to be replenished. Historically, that has translated into tax rate increases for employers.

Some of the most impactful cost reduction strategies for 2024 will soon be available and for a limited time only. Specifically, Ohio will be issuing employer tax rates for 2024 and there are a couple of options available for employers which can reduce their assigned rates.  Below we outline these strategies, which can often result in significant savings for merit rated (UI tax paying) employers.

1. Voluntary Contributions – Organizations may “buy down” their assigned tax rate by making an advance payment to move to a lower assigned rate. However, this option is not always advantageous and needs to be evaluated carefully.

2. Common Rating - organizations that have 51% or greater common ownership across multiple entities are eligible to participate in a strategy known as “common rating”. Common rating offers an opportunity to pool unemployment experiences for commonly owned entities which may save money on overall unemployment tax contributions.

Recently, a Sedgwick employment tax specialist saved an Ohio client with ten operating companies and 1,500 employees over $160,000 in one calendar year. The complex analysis involved understanding and meeting the legislative requirements and for this client, finding a specific combination – out of thousands of possible combinations – that resulted in the maximum tax savings.

In Ohio, the tax rate notices are expected to be issued around the first week in November.  The deadline for making voluntary contributions or filing common rating applications for the 2024 tax rates will be January 2, 2024, so time is of the essence.

Employers should pay close attention to the benefit charges reflected on their tax rate notices for 2024 and 2025. Certain employers were assessed duplicate charges from the middle of June 2023 to the middle of August 2023. Ohio expects to have the issue corrected for the June charges before tax rates are issued in November.

Please contact Lindy Hogan of the Sedgwick unemployment team if you have questions about how to take advantage of special Ohio tax strategies and to learn about other best practices to mitigate the costs of pandemic claims or how to manage traditional unemployment as we return to normal. Lindy Hogan can be reached at Lindy.Hogan@sedgwick.com.