Between changing compliance regulations and increasing costs, the unemployment claims process can be cumbersome for small business owners. Outsourcing to a company like GMS can help you navigate the costly and complicated landscape of unemployment claims processing.
The Cost of Unemployment for Employers
Employers are financially responsible for the unemployment benefits paid to unemployed, former employees via unemployment taxes. Unemployment tax rates are established by a formula that calculates total unemployment charges and compares that to the size of a company’s taxable payroll over a three year period. The average unemployment claim costs an employer $4,200, but can increase to as much as $10,000 or more.
While many business owners assume that unemployment taxes are just a cost of doing business, many former employees may actually be ineligible for unemployment benefits. Employers can fight many of these claims and keep their unemployment taxes low by denying benefits to those who should be ineligible to receive them.
Protect Your Business from Unemployment Claims
Should your number of unemployment claims increase, rising unemployment insurance rates can pose a serious threat to your company’s bottom line. Depending on your state, company size, and your unemployment claim history, unemployment taxes can cost your business thousands of dollars per year.
However, detailed record-keeping can help cut your costs and increase cash flow by lowering your unemployment tax rates. To increase your chances of winning unemployment cases, you should provide:
- Employee handbooks and detailed job descriptions.
- Written warnings that require employee sign-off.
- Witness statements.
- Specific examples of poor performance, in writing, based on information provided in the employee handbook and job descriptions.
Unemployment Claims Services
Unemployment insurance integrity laws require more detail at the initial claims stage, and the burden to answer all of those questions typically falls on the employer. This can lead to fewer wins and higher overall unemployment costs. Professional Employer Organizations (PEOs) like GMS help businesses manage unemployment claims and reduce unemployment tax risks in a number of ways. At GMS, we can:
- Respond timely and thoroughly to all unemployment claims.
- Reduce your liability for unemployment taxes.
- Help you write handbooks and job descriptions.
- Consult with you on the employee discipline and termination process.
- Ensure you stay compliant with unemployment laws and regulations.
- Provide representation at claims hearings.
- Provide reporting via our online payroll portal to access unemployment claims and tax rates.
- Provide education and training to help your organization reduce the number of unemployment claims and lower your unemployment costs.
When you partner with GMS, you no longer have to spend time trying to protect your business from unemployment claims and taxes. Our dedicated HR specialists will take on the burden of processing unemployment claims and meeting state requirements, so you can increase cash flow and eliminate liability. And best of all, you retain full control over your employees.
Contact us today or visit our FAQ page to learn more about our unemployment claims services.